How do you refinance into a loan, after the property has already been paid for with cash?
@Austin Walker It is considered a cash out refi. If you're doing a BRRR you need to wait until seasoning requirements have been met in order to refi using the ARV value rather than the purchase price.
@Scott Jensen- are the seasoning requirements based on the LTV or a period of time. Can you cash out as soon as you get a renter?
Period of time. Typically it's 6 months or a year depending on the type of loan. Make sure your loan officer knows you want to refi ASAP at the new appraisal value rather than the purchase price. They should be able to get you into the right type of loan for that.
You don't need the renter in there unless you need the rental income to qualify for the loan.
@Austin Walker sorry I am just catching this posting now. The basic element here is that you should get "PreQualified" before you purchase the home so you know what type of loan you can receive when you purchase a property that fits the BRRRR method. And what @Scott Jensen mentioned above isn't incorrect, but I did write an article on how to avoid any "seasoning" periods that you may run into with Fannie Mae and Freddie Mac loans (but there are other loans out there). To see the article I wrote for Bigger Pockets on it just click HERE
Let me know if you have any questions on it. Thanks!