Holding property and personal finance

Baltimore, Maryland
BRRRR - Buy, Rehab, Rent, Refinance, Repeat
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Holding property and personal finance

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Member since 2026 · 1 post · 0 votes

Hi Everyone, new to these forums and new to investing but not new to residential property. I'm a general contractor with lots of experience in remodels and some flipping.  

I'm considering starting to hold renovated or new construction properties.  My biggest question right now is how it affects my personal finances.  

Just to use round numbers say we build a new construction home and we are 300k all in . We get it appraised for 400k and I want to cash out refi at 75 percent to pull all my capital back out. Leaving 25 equity in the house as the down payment for the refi. Sounds straightforward? Say I do 2-3 of these and hold them but then I want to sell my personal home and buy another one. Are all those loans going to hurt my personal ability to purchase a primary residence? Does this change if I start a separate LLC for the rental properties?

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  • Alyson Anderson
    Realtor · Harford County, MD · Member since 2020 · 118 posts · 33 votes
    8mo

    Yes, those loans can affect your ability to purchase a primary residence. Most lenders will have their underwriter review the totality of your financial situation, but how much they impact you depends on structure, timing, and cash flow. An LLC alone does not automatically protect your personal buying power. My rentals in Baltimore (some of which I BRRRed) actually helped me qualify to purchase a second home that we now use as an Airbnb. I highly recommend meeting with your CPA and/or financial advisor to review both your short- and long-term goals before moving forward.

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  • Jose OrtizBusiness Member
    Accountant · South Florida · Member since 2026 · 47 posts · 18 votes
    8mo

    The strategy itself isn’t the problem...the financing is.

    Every time you refi, you’re adding a payment that a lender will see when you go to buy your own house. If the rentals are rented and documented, that income usually offsets the debt. If they’re new or mid-transition, it may not, and that’s when it can squeeze you.

    An LLC won't really change that. Most banks still look through it and tie the loans back to you personally.

    Where people get tripped up is order of moves. Buying a primary is usually easiest before you stack a few rentals. After that, you just need lenders who are used to investors, not first-time homebuyers.

    Jose Ortiz CPA

    The Scale Collective.
    WebsiteView Page
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  • Kenneth GarrettPro Member
    Investor · Florida Panhandle/Illinois · Member since 2016 · 4k+ posts · 3k+ votes
    8mo

    This is why DSCR loans are so powerful. Does not get reported on your personal credit history. You can have as many as you want. If one lender maxes out at say 3 million in loans you can go to another lender. The key is you will need to hold in an entity and it needs to be positive cash flow. I would not do less than a 1.25 ratio, but there are lenders who will 1.0 or less. Rates will be higher. Ratio is PITIA: Principle & Interest, Property Taxes, Insurance and HOA if applicable.

    Rent is $2500

    PITIA IS $2000

    Ratio = 1.25

    Many DSCR lenders on here as well.

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