Can I refinance an investment property or second home?
Yes. Investment properties and second homes can be refinanced like a primary residence either to reduce the payment, the loan term or to take cash out. However, lenders consider these types of property more risky than a primary residence so loan parameters will be more restrictive. For instance, the maximum LTV will be lower, the credit score requirement may be higher, the interest rate will be higher etc. etc.
Having said that, may people routinely refinance their investment properties as a way of turning the equity in the property into cash. Every few years, as the property continues to appreciate, they refinance taking out as much cash as they can. This cash can then be invested, used to buy additional properties or simply used as income thereby giving the property owner a constant cash flow without having to buy and sell properties.
Will I have to show proof of income? Assets? Employment? How can I reduce my mortgage payment as much as possible?