Question regarding cash out refi on rental property

[Thomas C Perry Jr]

How do you maintain cash flow after a cash out refi for a rental property? Does the increased principle balance significantly reduce the monthly cash flow? How do you work that value into your initial pro forma when running the numbers on a property?

[John Morgan]

@Thomas C Perry Jr

I did my first cash out last summer. After taking 140k out to play with, I was basically breaking even on my property with a 15 year loan. That's ok, I used that cash to snag a great deal and did a BRRRR. Then after a cash out on the next property, I snagged another one. Then did a cash out on that one to snag another one with cash. So with doing my first cash out and breaking even, I was able to acquire 3 other properties that cash flow. I have no regrets even though I'm only breaking even on my first cash out on my original property. It's a risk I'm willing to take.