BRRRR refinance commercial vs residential

[Dan Johnson]

Closing Date: 10/5/2018

Rehab period: 10/15/2018- Jan 31, 2019

4 unit rental property which will be held as long term rental property

Purchase price: $79,000 using a commercial 5 yr loan amortized over 25 years w/ 15% down payment

Rehab: $45,000 of my own money

ARV: $100,000

NOI upon purchasing property: $9,629

NOI after rehab: $15,857 (60% increase after boosting rents and decreasing operating costs)

I’m looking to recoup the $45k rehab money I’ve put into this property as quickly as possible. The way I see it there are 2 options:

1) Residential refinancing which requires a 6 month seasoning period. Will a residential refinancing appraisal take into consideration the fact that I increased NOI? Or does residential refinancing appraisal only care about condition of the house and improvements made (and not the rental income)?

2) Commercial refinancing. Once I get all units occupied at a higher rent price can I then apply for commercial refinance right away? Or should I wait several months to establish rental history at higher rent prices?

My current commercial loan appraised this rental property at $86k before any rehab. Property condition was considered fair (it was actually poor in my opinion). Is this $86k figure now tied to my property and set in stone? Or will I easily be able to get a higher appraisal value based on higher rents, higher NOI, and improved property conditions due to remodel (new cabinets, new interior paint, new doors, new windows, new water heater, new support structure, new bathrooms, new appliances, new exterior paint, etc)?

Does commercial appraisal usually just focus on rental income and NOI or does it also focus on improvements in the condition of the property?

Thanks,