BRRRR Newb: Confused about cash-out refinance?

[Hal Fitzgerald]

Hi BP members,

I've been reading up on BRRRR, and for the most part, I understand the basics. However, I'm confused about the refinancing part. Specifically, the cash-out portion confuses me. I'm familiar with the term 'refinance' as replacing an existing mortgage with a new one to get a lower interest rate or different term.

What I got from reading about BRRRR is that when you're ready to refinance, look for a "cash-out" refinance loan. Here's an example of what I'm thinking:

* I bought a distressed home for $50,000. I rehabbed it for $10,000. And it gets appraised for $100,000. Then, I look for a cash-out refinance loan.

* The bank offers me .75 of 100,000.

* Does that mean I get $75,000 in a check form? I use that $75,000 ($15,000 extra income [75k - 60k total cost ]) to buy a new property or put it in my bank. Is this correct?

Thank you everyone! Any help is appreciated!