Looking for Refinancing Help

3 Replies

My partners and I purchased a foreclosed property a few months ago. This is our first purchase. We rehabbed the property and now have a good tenant making good cash flow.

The problem is we are trying to use the BRRRR method and were turned down for a refi. We do not have bad credit but it isn't the best. Our scores hover in the low to mid 600's. What other avenues are there for use to try. We want to get another property this year so we can scale next year.

Thanks

Originally posted by @Revis Boyd Isbell III :

My partners and I purchased a foreclosed property a few months ago. This is our first purchase. We rehabbed the property and now have a good tenant making good cash flow.

The problem is we are trying to use the BRRRR method and were turned down for a refi. We do not have bad credit but it isn't the best. Our scores hover in the low to mid 600's. What other avenues are there for use to try. We want to get another property this year so we can scale next year.

Thanks


Unfortunately, until your credit gets over 650 and preferably 700, the loan to values you'll be offered won't make BRRRR work for you.

Focus on your credit.  Pay your credit cards down to 28% of the credit limit and make your payments on time.  

Order a credit report from Equifax, Transunion and Experian and run "what if" scenarios to see what you have to do, specific to your situation to increase your score. Then do that.

You may have to sell this property if you have hard money on it unless you can wait a few months for your score to jump.

Best of luck

Stephanie

 

@Revis Boyd Isbell III

There are other avenues to take in this case. You may find private money lenders in your area that may provide lending based on appraisal of the property. These types of lenders do not focus on credit, work history, etc. as the property is what dictates the loan amount. 

Please do be aware that these lenders may have higher rates however, and the loan will depend on the amount of equity you currently have in the property. They may also be able to cross-collateralize with any other properties you may have. I cannot guarantee this will work in your case, but it may be worth a shot.