[Calc Review] Help me analyze this deal
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How do the holding costs get factored in to a deal? When you use private or hard money to do a BRRRR deal, all these costs accrue (interest, insurance, taxes) when you are doing the rehab and unable to obtain cash flow. Who pays for these costs? Does the bank cover them when you refinance or do they come out of pocket?
For example, in my deal I have almost $15k in holding costs, but the deal comes out to say I am only invested in for $6,500 of my own cash even though the refinance will not cover all of my initial loan.
What am I not understanding about this process?