Skip to content
×
Try PRO Free Today!
BiggerPockets Pro offers you a comprehensive suite of tools and resources
Market and Deal Finder Tools
Deal Analysis Calculators
Property Management Software
Exclusive discounts to Home Depot, RentRedi, and more
$0
7 days free
$828/yr or $69/mo when billed monthly.
$390/yr or $32.5/mo when billed annually.
7 days free. Cancel anytime.
Already a Pro Member? Sign in here

Join Over 3 Million Real Estate Investors

Create a free BiggerPockets account to comment, participate, and connect with over 3 million real estate investors.
Use your real name
By signing up, you indicate that you agree to the BiggerPockets Terms & Conditions.
The community here is like my own little personal real estate army that I can depend upon to help me through ANY problems I come across.
General Real Estate Investing
All Forum Categories
Followed Discussions
Followed Categories
Followed People
Followed Locations
Market News & Data
General Info
Real Estate Strategies
Landlording & Rental Properties
Real Estate Professionals
Financial, Tax, & Legal
Real Estate Classifieds
Reviews & Feedback

Updated about 3 years ago on . Most recent reply

User Stats

13
Posts
6
Votes
Martin T.
  • Investor
  • Durham, NC
6
Votes |
13
Posts

Cash out refinance even if I lose little every month?

Martin T.
  • Investor
  • Durham, NC
Posted

I'm in the process of refinancing an investment property I have owned for 3 years. The value has gone up significantly and I'm about to get a better rate too. I'm considering taking the max out that the LTV of 75% allows. I'll get more cash at closing to use for other deals, and to invest in general, but if I take out the max I'll also be about $100 short each month.

If rents continue to climb they way they have been here, and interest rates go up again, having that money at 3.5% and then only waiting a year or so to break even again seems appealing to me.  

Obviously I could take out less and have a LTV of 65 or 70% but the point of this refinance was to lock in some of those gains, and get cash at a low rate for other investments.

Would you do it? Why/why not?


Most Popular Reply

User Stats

26
Posts
23
Votes
Troy Ballew
  • Rental Property Investor
  • Portland, OR
23
Votes |
26
Posts
Troy Ballew
  • Rental Property Investor
  • Portland, OR
Replied

@Jason Hirko

Right! When I do a cash out refinance, I shoot for 75% but also require that the property make at least a bit of positive cash flow ($150-$250 per month) just to build in a bit of conservatism. The extra 5% (or so) of equity being pulled out just isn’t worth “pushing it” in my opinion.

Troy

Loading replies...