Conflict between Lenders

[Brody Veilleux]

If I get a conventional mortgage on a BRRRR, and get a HML renovation loan. Am I going to run into issues with the property having 2 liens on it? Does this mean the only way to use a HML is for it to cover purchase price and rehab?

[Bill B.]

If you get the conventional mortgage and it records as a first lien that's simple every day deal. As long as the HML lender knows they're going to be in 2nd position that also shouldn't be a big deal. When you do the refinance you pay them both off assuming you added at least 120% of your removal costs in value. If the remodel only adds what you spend you'll have to come out of pocket another 20% of the HML plus closing costs to refinance. So make sure you can cover both loans for awhile.