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Good time to refi properties to grow portfolio
I have two SF properties in KC, MO and I want to add to my portfolio. I'm thinking about refinancing the two properties to pull the equity out and use the cash to acquire more properties. What are people's thoughts on this strategy (essentially completing the last 2 stages of BRRRR strategy) and the timing - given the current market conditions... Thanks!
If you can still meet your criteria in cash flow with acquiring a higher interest rate then go for it.
@Remy Piazza I'm on the opposite coast as you (CA) but also invest (and lend) in Missouri. It really depends on what rate you're giving up vs. how much you're pulling out vs. what kind of return you can get with the proceeds. As a "youngish" person scaling their portfolio I've been leaning towards maximizing cash out in my portfolio (as long as I stay in good DSCR position) so that I can grow it as quickly as possible. Many deals in KC, MO will still cash flow just fine with these 30 year fixed rates in the 7s at reasonably high leverage. Happy to chat offline. Feel free to reach out anytime.
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#3 BRRRR - Buy, Rehab, Rent, Refinance, Repeat Contributor
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#3 BRRRR - Buy, Rehab, Rent, Refinance, Repeat Contributor
- Investor
- Austin, TX
The best time to refinance is when you have more deals to close on. Focus less on the interest-rate and more on your buying power.
If you can still cash flow after the refi and it helps you get more deals, it's a good idea. Time in the game is the most important thing, you'll be able to refi the old and new properties down the road when rates come back down again.
Hey Remy!
I'm an investor and agent here in KC and would be happy to offer some insight. I'll message you.
How if you refinanced into a HELOC? We can do it.
@Remy Piazza if you have deals go for it if the numbers work out. Look at other options like LOC's as well. Positive is it works and you find a deal and keep growing negative you don't find a deal you like, and now just pulled cash out and locked up most likely worse financing.
Cheers!