Refinancing Hard Money Loans with a Conventional

[Jose Corbera]

Hi Everyone,

In the past I've purchased properties to buy and hold with conventional financing but I'm thinking of implementing the BRRR strategy to scale things a bit. For those of you that have actually executed the BRRR strategy, how do you get around the guidelines that state that if you want to cash out based on the "new appraised value", it will have to be after 6 months in order to refi conventional? I say conventional because I assume that would be the least expensive way to refi.

Does this mean I have carry the hard money loan for at least six months? Seems very expensive to me if that's the case. Is there an alternative? Any guidance would be amazing.

Thank you in advance for the insight.

[Kerry Baird]

Yes, plan to carry for six months.  You can start the refinance before the six months are completely up. 

Or you can buy with cash (HELOC or other funds) and do a "delayed refinance" and get your money back before the six months.