All Forum Posts by: Jose Garcia

@Nicholas Covington thanks Nicholas ! so if I were to run it through a calculator with a refinance of 5% for example, would it include taxes and insurance? if not how can I calculate them together ? 

@Tim Herman thank you ! isn't the refinance used to get out more money than the first loan anyways, so how would you keep your cashflow with rents remaining the same during the refinance? also what would be the reason for seasoning the first loan 6 months after rehab? wouldn't the equity be acquired after the rehab saving you money if you aren't required to pay monthly payments? 

so I'm trying to acquire my first brrrr deal and when I plug the numbers into the brrrr calculator it shows a negative cashflow on the refinance part and only a 6% ROI during the first loan.(hard money loan) im not sure if the deal is bad, the terms from my lender are bad, or im putting wrong information on the refinance part of the calculator, OR the deal and lending terms are both great but just don't work together. please help?

The property is In Atlanta and has an ARV of 210k, asking price is 60k, and repairs are 40k with rents at $1350.

the terms of my lender are: 100% financing for both purchase price and rehab, for 6 month term with all closing costs and fees wrapped into the loan, 3 points (or additional 3 months for 2 more points) with no monthly payments at an 8.29% interest rate. so essentially I am paying $0 out of pocket as of right now which I am fine with because I have little to no capital saved up. 

now when I put in the refinance info, I input a loan of 147k (70% of ARV) and 5% interest for 30 years. that way I can pay off the first lender and have enough to repeat the process with whatever is left over plus what I will be saving. but then it shows negative $350 cashflow. what really eats up the numbers are the taxes and estimated mortgage payments at like $850 a month. are taxes and insurance not included with a mortgage? is it not a good idea to completely cashout refi 70% of ARV 210k if it can't be covered by monthly rents?(assuming I put forth a good percentage for expenses, and my own cashflow as well)  is the brrrr calculator always accurate???

Thank you for taking the time to read and answer, any information would be greatly appreciated.