Using first deal to fund next?

[Jessie York]

Ok bought my first investment!!!! House appraised for $75,000 I purchased for 65,000 with 20% down so financing $52,000. Currently rents for $1200/$300 a room to college students. I’m needing to figure out my next step to use the equity to fund my next property. I should be able to get a 80% loan on my equity for down payment on next property correct? Would this be considered BRRRR or should I try & refinance this property after I make some improvements. I have built in equity from the purchase & he doesn’t need a ton of work right now.

[Omar Khan]

@Jessie York BRRRR is just a cute term used to describe the strategy real estate investors have been using forever. You leverage the equity in your existing property as a down payment (or partial down payment) into your next asset. Rinse and repeat.

If you just acquired the property, you might want to season the loan for a few more months (check with your lender). Also refinancing and/or getting a new loan isn't free. You will be charged points and other expenses. So do a break-even analysis to make sure you are in a beneficial situation.