Looking for BRRRR Bank in Cleveland Ohio

[Keith Minton]

Hello

I am looking for a bank where i can do a cash out refinance on properties i buy with Cash that will lend in the Cleveland Ohio area.

I have called around but not that many banks will do a cash out refinance without a long seasoning period.

My partner and i have the experience we have flipped about 10 houses and currently manage about 50 apts .

I plan on buying a rehab with cash and using cash for the repairs and the refinancing out all my money.

Basically the BRRRR strategy. rough numbers at buy for 40-50k put in 20-30k appraise for 90-100K and pull out 70-75% of that.

Just need some more money to scale.

Thanks for you help

Keith

[Eric Veronica]

@Keith Minton Do you consider 6 months to be a "long" seasoning requirement? 

Lets say you buy a place for $50,000 on Jan 1st .  Mid February you complete a $20,000 renovation and initiate a refinance.  Appraisal comes in with a value of $90,000.  If you close the loan before July 1st then your loan amount will be limited to the initial purchase price plus closing costs and prepaid fees. Assuming $3,000 in loan costs  would result in a loan amount of $53,000.  If you close the loan on July 1st or later then you will be able to get $67,500(75% of $90,000)

Obviously if you had a crystal ball and you knew exactly what the home was going to appraise for then you would know whether or not to wait for the 6 months to pass.  Normally my approach for Ohio investors is to initiate the loan after renovation has been completed and order the appraisal.  Once we get the appraisal back you can make the decision.  Do you want $53,000 in March or $67,500 in July?

If the appraisal comes in at $115,000 then it probably makes sense to wait because you are comparing $53,000 in March to $86,250 in July.  Difference of $33,250

If appraisal comes in at $75,000 then it probably makes sense to just close in March because you are comparing $53,000 in March to $56,250 in July.  Difference of $3,250. 

Hopefully this helps a little.