Can i Brrrr with 25% down and rehab costs then bridge into loan?

[Lee Cruz]

I only have enough cash for a downpayment and rehab costs. About 50k total for the regular 100k to 150k properties around here.

Question 1:

Im still tryiing to understand the brrrr strategy. To refinance, arent i only allowed to take out what ive put in? If i put 50k in downpayment and rehab costs am i allowed to only take out 50k? OR If it appraises at 160k, ill leave in 25%=$40,000 and pull out 75% = $120,000 minus original loan and pull out my downpayment and rehab costs?

Question 2:

Do i need a private lender or HML if a credit union will help me bridge the purchase a conventional loan/refinance and bridge into a 25yr conventional loan. What im asking is do i need to purchase the house outright(i dont have the cash) or just a down payment plus rehab costs (50k total).

Im still looking for my first property. My mortgage broker says hes found a lender that would loan on 75% as long as i can put down 25% at 3% interest. Ill also put in my own rehab costs out of pocket. Once im done they'll appraise it and bridge it into a conventional loan back at 3%. Does this sound right? He says its better than a HML because im using the same credit union with lower interest.

example: from bp calculator

Purchase Price:

$90,000.00

Purchase Closing Costs:	$3,000.00
Estimated Repairs:	$20,000.00
Total Project Cost:	$113,000.00
After Repair Value:	$160,000.00

Acquisition:

Down Payment:	$22,500.00
Loan Amount:	$67,500.00
Loan Points/Fees:	$4,350.00
Loan Interest Rate:	3.000%
Monthly Interest:	$168.75
Total Cash Needed At Purchase:	$49,850.00

Refinance:

Loan Amount:	$120,000.00
Loan Fees:	$3,000.00
Amortized Over:	25 years
Loan Interest Rate:	3.000%
Monthly P&I:	$569.05
Total Cash Invested:	$350.00

Monthly Income: $1,200.00	Monthly Expenses: $1,090.55	Monthly Cashflow: $109.45	Pro Forma Cap Rate: 5.09%
NOI: $8,142.00	Time to Refinance: 4 Months	Cash on Cash ROI: 375.24%	Purchase Cap Rate: 9.05%