BRRRR strategy question.

BRRRR - Buy, Rehab, Rent, Refinance, Repeat
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BRRRR strategy question.

Michal Kasza
New to Real Estate · MA · Member since 2020 · 33 posts · 11 votes

Hi all. So I'm aware that you all know what the BRRRR strategy is. However, I have a quick question regarding the final numbers. After the refinance of a property shouldn't the PMI be removed off the loan when someone refinances their home but still leaves 20% to eliminate PMI?

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    Rental Property Investor · Escondido, CA · Member since 2018 · 268 posts · 137 votes
    6y

    @Michal Kasza, if your appraisal showed that you had 20% or more equity in the home, i.e. your new loan would be 80% LTV or lower, you could potentially get rid of PMI. The question does assume that you had a loan requiring PMI which was used to acquire the property. Many BRRRR deals are financed through private or hard money, and in some cases, if the rehab needed is substantial, a property may not even qualify for traditional financing.

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