Cash out refinance and the BRRR stategy.

[Harley Pennington]

• Cash out refinance. 
• Loan to value ratio.
• Brrr strategy.
• If I find a house and it needs work, can I use a 203k loan to get the rehab money up front? And I only had to put 3.5% down? So once you appraise it, the value goes up. So what happens when you do a cash out refinance, when your LTV (loan to value) ratio goes up? Does that mean you can pull some money out? If so how much?

[Pat McGrath]

hmmm all questions for a fully qualified lender. short answer is you can get a cash out refi...BUT some lenders would only do that to get you to 85% LTV. (some say they will do more?) It has to APPRAISE....just because you put in $25k in remodel, doesn't mean its worth 25k more...So a cash out refi is not very easy to do & still has some risks. If you did it for investment and didn't live there, you would have to do 15-20% down (15% the rates are higher) to get it in the first place, then they would do a 80% ltv cash out refi...but again, depends on appraisal.

so if its your primary residence, you only get to 85% LTV for cash out refi (so i'm told by my lender who i just got off the phone with).