Bought a 24 unit complex 2 years ago Rehabbed and ready to BRRR

18 Replies

Bought a 24 unit complex 2 years ago.  It had been foreclosed on and was empty and trashed.  Now it has been rehabbed and is at 90% plus occupancy.  Would like to refinance from local bank at variable rate to a permanent rate.  Should appraise in the $700K to $800K range and would like to do a cash out refinance so I can by my next multi-family property.  Any suggestions on where to start the process?

@Johnoson Crutchfield correct, he can use it to purchase the property or just put the down payment. The idea is the same as refinancing with taking some cash out, but a little bit different. It is almost like you are getting a credit card for the amount of available credit given against the property. You only pay % when you take out money to use. 

I'm about to try to do this on a property I'm renovating. I've got the seller carrying the note but I think the building is worth much more. Thinking I can get a bank to give me a line on the property so I can go out and do more deals.

@Walter Ellis Big congrats on bringing the building back to a productive life. @Oleg Shalumov has the right idea with the LOC. I got a LOC on a property a while back but can't find anything worthwhile to spend it on. I only invest in my immediate area and there are no MF's around worth buying at the moment-so I am biding my time. Meanwhile the LOC costs nothing.

@Walter Ellis ... Just reach out to lenders. Start locally, as the lenders will be able to quickly assess the asset. 

Congrats on performing value-add and Good Luck.

@Walter Ellis

Congrats on the successful plan execution with your property! In addition to refi and HELOC, consider if 1031 works for you. You can sell this property and put the gains towards the down-payment of a larger one and defer your gains this way.

@Alina Trigub

1031 is something we have considered and are still considering. This property is not in a great area, it’s a C market, small town type area. I worry that we will have a hard time selling it where it’s at. I know the numbers will justify a good appraisal, but getting someone to pay that might be a different story. I am new to this though, I could be wrong.

Walter,
Why don't you talk to a broker or better yet, put the property on the market and see what happens. 


Originally posted by @Walter Ellis :

@Alina Trigub

1031 is something we have considered and are still considering. This property is not in a great area, it’s a C market, small town type area. I worry that we will have a hard time selling it where it’s at. I know the numbers will justify a good appraisal, but getting someone to pay that might be a different story. I am new to this though, I could be wrong.

@Walter Ellis ..you state you're looking for a fixed rate loan, but that doesn't mean anything not knowing what type of term you're looking for.  Fixed rate financing should be available, but are you looking for fully amortized loan options or are you okay with what most banking is going to be - 5-10 year money on 25-30 year ams, fixed rate for loan term.  I'm unclear.  Location does matter, but there still should be lending options for you.  But some of it is going to be based on expectation and what is available in the capital markets.  What are you looking for?  and what are your main kickers?  

That might help you get some better answers.  I might even have some options, but I need to know how to direct.  Pm if you want.

Thanks