Can you get a refinance loan BEFORE you buy and rehab?

[Ruth P.]

Hello BP: With the BRRRR method, you refinance at the end before repeating. What if you approached a bank for a refi loan asking them to agree to refinance for a house that you are interested in buying, but you want them to agree to refinance IN THE FUTURE, after it has been purchased with cash, rehabbed and rented. Is that even possible, and if so, is it done often? Any help to clarify my mind on this is much appreciated!

[Patricia Steiner]

@Ruth P.

I recommend a different approach:  interview lenders.  Make sure that you are working with one who has a sizable investor clientele and understand his/her parameters/qualifying criteria/rates/structure for every borrowing scenario.  If a lender is great at purchase money mortgages but is challenged when it comes to refinancing, you'll want to know that upfront and seek another resource.  No lender - and rightfully so - is going to commit to future loans.  Each stands on it's own; but it is important to know that you have a lending partner that can do it all and that you're knowledgeable about what it will take to get a refi/cash out going forward.

Reading the book is great...finding the right resource(s) is priceless.