how to get my cash back on this deal?

[Rigo V.]

I am looking at a property that I think I can get for $135K and its should appraise around $170K. I was thinking of going in with the 20% dp (Mortgage would be for $108K) and purchasing it. I would then do a cash out refi at 80% ltv  fixed to get back some of my cash. Property would still cash-flow well. 

Is a LOC a better option? I am trying to avoid silly fees but dont want to leave my dp into the deal. I also don't want to run the risk that the interest on the LOC will skyrocket.

Any advice? 

[Brian H.]

First, one thing I see over and over on here from people that have done this for a long time.... Don't use future, assumed rents to run your analysis. By that I mean, don't think "Oh, I will raise rents by maybe... $100/month to 700/month" and then use that 700 as your number. Use the rates at which they have already been successfully rented when doing your analysis.  If you are able to make the deal work with those numbers, awesome. Then, when you hopefully are able to raise rents (never guaranteed to work) that is just icing on the cake!  I only say all that because you said "rent will be increased".

So you are looking at maybe $70k into the deal in your own cash? Or are you looking at lending that incorporates the rehab costs?