Is the Ability to "Cash-out" Re-fi Part of Your Buying Decision

[Brandon Sturgill]

Do you consider the ability to re-fi a rental property before you buy?

[Jeremy Zindel]

I do consider the ability to cash-out refi with every property I buy, but that's because it is a critical part of my strategy.  As @Rodney Kuhl  stated, it just depends on your goals.

My model is to buy a distressed property at a discount, rehab the property, put a tenant in place, and then cash-out refi to pull all my money back out so I can do it again. I'm working local banks (portfolio lenders) which is also crucial to this strategy. I can refi for up to 80% of the appraised value after renovations with virtually no hassle (no seasoning requirements, no rehab documentation, quick and less expensive closing vs conventional, etc.). I just make sure I'm all in for less than the 80% of ARV and I can continue to build my portfolio with no money in a deal after the refi. Infinite ROI is great!

@Brandon Sturgill , I use this strategy with SFRs but I would think you could do something similar in the multifamily space.  If you want to build a portfolio quickly, I think setting yourself up to be able to take advantage of cash-out refis to continually put your equity to use is a great plan.