BRRRR and refinancing sooner than 6 mo.

[Charlotte M. Varble]

I was told by a lender that due to regulations with Fannie Mae and Freddie Mac, I cannot refinance on a property with a cash out until I’ve owned the property 6 months. (I can refinance sooner than 6 mo but only for the payoff amount.)

Our strategy was to refinance within about 3 months and use the cash out (the difference between what we owe and about 75% LTV) to put into our next property and keep acquiring at a decent pace.

For those who are doing BRRRR, are you refinancing with a cash out before 6 months? If yes, than how are you doing it?

[Ryan Murdock]

@Charlotte M. Varble If you are going to continue at any sort of scale you'll eventually end up in the commercial lending arena. There are some down sides and additional expenses when dealing with commercial lending but the upside is there are generally no seasoning requirements so you have much quicker access to the equity. More than once I have gone straight from the closing table to the bank to initiate a refi that same day.

For now you're probably better off waiting out the 6 months and taking advantage of the better terms you're getting but at some point you will start buying properties using your LLC and embrace the world of commercial loans.