Updated almost 6 years ago on . Most recent reply
Cash out refinance BRRRR strategy with multi unit property
Hello BP. I have a question. I am working on a deal. If I purchase a six unit property using a hard money lender. How soon would a commercial lender allow me to refinance the hard money. It’s a great deal with a 12% cap rate. Please educate and/or help if possible
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@Account Closed In my experience, it will depend on the lender. Most will say at minimum 6 months and some will want 12 months of NOI or a rent roll to show a stabilized property. However, if you have 6 units with 12 month leases and the rental income to support a solid business plan, a commercial refinance could be a lot quicker.
With the current state of affairs, I would not bet on it though. Lenders are really tightening up their willing to accept risk and rents are definitely not guaranteed at present even with a lease agreement from tenants. Still, it never hurts to have the call with the lender before you even go under contract. Form that partnership and find out.