BRRR Refinance- How much are you getting?

Question

Getting ready to do my first BRRRR, where I will be purchasing the home and rehabbing with cash. I then plan on Financing the property.

My question is what percentage of ARV are you guys able to finance for your Non-Primary Residence investment properties?

I spoke with a local bank that offers 80% for a primary residence and 70% for non-primary residence such as investments. Not sure if this is typical or if I should try searching for other banks.

Account Closed · Answer

@Kyle Perry once upon a time Montana had “safe and prudent” speed limits... you’d be wise to stick with safe and prudent leverage. Especially starting out. Don’t want to go BankRRRRupt.

Alex Kellman · Answer

I suggest working with a community bank or credit union.  These lenders usually hold the loans on their books so they have more flexibility with the lending criteria. The community bank I use lend up to 75% LTV. I haven't found a bigger bank that lends more than 70% LTV

Michael Noto · Answer

@Kyle Perry Things are changing daily with the ability to cash out refinance space. You will almost certainly have to refi with a traditional bank. After the last crash 70% LTV was the best we could get for our first BRRRR and eventually as the market improved and we gained more experience we had lenders willing to do 75 or 80% LTV but it takes a while.

Andrew Postell · Answer

@Kyle Perry as mentioned above different lenders will have different LTVs but there are lenders that can provide up to 85% LTV if you structure your purchase and can be qualified for that type of a loan.  Let me know if you have any other questions.  Thanks!

Kenneth Garrett · Answer

@Kyle Perry

I generally am able to get 75%.   I have been able to get 80% with a high cash flow property.  Check small local banks in your area.

Ashton Cleveland · Answer

I’m getting ready for my first BRRRR as well and yes that checks with my research/lenders I’ve talked to so far. Also make sure they are offering a LTV refi as opposed to LTC if you’re trying to get the most money back out.