Can’t refinance to do BRRRR

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Can’t refinance to do BRRRR

Thomas Klein
Pompano Beach, FL · Member since 2017 · 23 posts · 7 votes

Hey everyone,

I have four single family homes in Fort Lauderdale. 

I bought property 4 using two Interest only HELOCs from two of my single family properties.

Property 1 had no mortgage. I have a $112,000 INT only HELOC. Property is valued at $180,000. Cash flow is $700 per month.

Property 2 has a first mortgage with a balance of $50,000 and $137,000 INT only HELOC. Property is valued at $300,000. Cash flow is $300 per month.

Property 3 has a first mortgage with a balance of $350,000. Property is valued at $430,000. Cash flow is $125 per month.

Since I used the HELOCs to purchase property 4, my total DTI is up to 72%.

I don’t have any issues with making all the payments, but it would be nice to pull the money back out to pay the HELOCs back and repeat this process, without selling property 4.

Any suggestions would be amazing!

Thanks to everyone in advance!!

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  • Nicholas Covington
    Mortgage Broker · Dallas, TX · Member since 2017 · 657 posts · 275 votes
    5y

    There are asset-based lenders out there that I work with that would allow you to get cash out of the property depending on credit and how long you have owned the property. 

    0Reply
  • Eric Johnson
    Lender · Chicago, IL · Member since 2016 · 653 posts · 313 votes
    5y

    Thomas, I'd be happy to offer some insights. You'd need to go asset-based commercial financing here. Shoot me a DM. Happy to help.

    0Reply
  • George DespotopoulosBusiness Member
    Lender · New York, NY · Member since 2016 · 936 posts · 287 votes
    5y

    @Thomas Klein - the properties have a lot of equity in them and 2/3 seem to have above-average DSCR, which is great to see. Given that your DTI is @ issue, it may beneficial to look to working with a non-bank direct lender that doesn't look at your personal income or DTI. The property values are strong, so it depends on your credit and how long you've owned them, but I would expect to get 70-75% LTV.

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    0Reply
  • Mark Stark
    Lender · Denver, CO · Member since 2020 · 26 posts · 1 vote
    5y

    @Thomas Klein with that much equity in the properties we should be able to get you up to 80% of the value out in cash quickly. Feel free to shoot me a PM.

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