Rinse and repeat logistics

[Sandra Holt]

I have heard a lot about this "rinse and repeat" strategy and I am wondering about the logistics. I recently bought a house where I used a home equity line of credit for the 25% down payment and a conventional mortgage for the 75% remaining. After I close, I would like to refinance so that I can take out that 25% and use it toward my next property. Luckily I bought the property with $30,000 built in equity so I don't have to worry about the property not appraising for enough to take out that 25%. My question is, how do I logistically refinance as far as timing goes? Can I close on the primary loan in one day, and then refinance that same day? Do I have to wait a certain amount of time before I can refinance? Can I use the appraisal from the primary mortgage for the refinance? Also, I'm really not looking forward to paying closing costs on the refinance since I just paid a boatload of closing costs for the primary mortgage… Is there a way around this? Thank you in advance for any and all help!

[Ned Carey]

Most lenders are going to want you to season the property 6-12 months before refinancing if you are getting cash back beyond the original mortgage amount. 

To expect that you will be able to refinance out all your cash on rentals is not a realistic expectation. Can it be done yes. Can you do it consistently time after time in a simple "rinse and repeat" process - not likely.