Cashout refinance BRRR (please explain)

[Lee Griswold]

My first House I bought when I was 25 for 90,000. It is a 2 bed 1 bath single family. I have 7 yrs left on my loan and I owe 36,000.  The mortgage payment is 800 a month. At my last appraisal it was worth 140,000. I currently get a 1000 a month in rent. if I do a cash out refinance how much capital can i take out? Will the property cash flow (or is it cash flowing now). So can someone help me run the numbers and explain to me the how and why, so  I can run them my self in the future?

[Tim Herman]

@Lee Griswold You need to download a financial calculator or spreadsheet. You can use BP rental calculator for more insight. Most cash out refi are 75% loan to Value. Using your $140000 appraisal. $140000*.75=$105000, which will be your loan amount. Most cash out refis the interest rate will be around 5%. Using your mortgage app the loan amount of $105000 @ 5% interest rate and a 30 year term(why 30 years, it provides the best cash flow and the tenants job is to pay the mortgage). Plug those numbers in you get a payment of $563.66 principal and interest. Have to add insurance and taxes. 

To see if you cash flow you need to account for vacancy, repairs, capex and property management, hence the BP rental calculator. You can use for 5 times or upgrade to pro for unlimited uses(sounds like I am a shill for BP). Real estate is all about the numbers, learn to love your calculator.