All Forum Posts by: John Kelsey

Hi Yosef,

  I had a lot of the same questions, and just started a similar thread post.  My issue is that in my area banks won't let you refi to a 30 year loan on investment properties.  They only do a max of 10 years...which is really throwing a hitch in my giddy-up.

In this example, I was already factoring in the rehabbed rent amount.  Thats a good point, since I'm most likely going to be limited to a 10 year term, I could just refi a lower amount to the point where its still cash flowing.  I didn't consider that.

Thanks for the feedback, most appreciated.

I've been looking at this to make sure the property cash flows based on the original purchase amount and NOT the refi amount...which now seems to be incorrect. :)  If I refi for 60k over 10 years, thats like $600ish payment.  If the rent is is only $750ish..then I'm losing (after taxes, insurance, etc).  The rent would probably have to be closer to $1k to make this attractive.  Hence, in this example its probably not a good deal.  Am I on the right track?

Thanks all!  Stay safe.

Ok, I'm picking up what you're putting down.  In this example though, I'd have to refi for a longer term in order to get the cash flow. On investment properties in my area, banks will only do a 10 year term.  If I refi out, will banks typically do a 20 or a 30 year term?  Since I dont have really have any skin in the game at this point, should I care about the interest as long as its cash flowing?

Thanks all!

I'm getting hung up on part of the BRRRR strategy, can somebody explain it to me like I'm a small child?

Example:   I buy a 40k house, put 8k down and spend 15k on rehab.  Now it appraises at 80k.  The bank lets me refi out 60k (75% of the 80k).  So I got my 23k back that I invested plus I'm 37k to the good to use on another property, correct? BUT....BUT...now instead of paying on a 32k mortgage, I'm now making payments on a 60k mortgage.  I'm still borrowing money and making a monthly mortgage payment.  Is the idea more that now the tenants are basically making the mortgage payment and I have zero risk because none of MY cash is in the property now?

Thanks all, just want to make sure I understand this.  Stay safe!