How Are You Using Refinancing to Grow Your Rental Portfolio?

Question

I’ve been thinking a lot about how refinancing can be a powerful tool for landlords. Instead of selling properties to access capital, many investors are using refinancing to free up cash while still holding on to their assets.

For landlords trying to scale, this could be a way to keep the portfolio growing stronger without losing good long-term holds.

Curious — how are you all approaching refinancing in your landlord journey?-Do you prefer to refinance and recycle capital?

- Or do you lean more toward paying down debt and building equity the traditional way?- Any lessons learned (good or bad) from refinancing strategies?

Would love to hear how other landlords balance growth with stability when it comes to using their properties’ equity.

Carl Millsap · Answer

@Kelly Schroeder

1. The BRRR method works. My mentor told me you make money when you buy, so ensure the numbers work from the beginning. Determine your buying criteria and stick to it. For me a property has to cashflow from day 1. I don't buy for appreciation, I buy for cashflow.

2. I've refinanced some properties 3 or 4 times to buy more. The numbers for both properties has to work. I won't refinance a property for more than 80% LTV.

3. If you're buying single family / duplex homes get 30 year fixed rate mortgages. If you're buying small to mid size multifamily 8 units or more where the money is only fixed for 3-5 years, get 5 year fixed.

4. Know your numbers and control expenses.

5. Develop a plan to pay down properties. This way when an opportunity comes up you can refinance and take advantage of the opportunity.

6. Develop a relationship with multiple banks / bankers. This will make it easier to get financing.

7. Keep your personal debt level low.