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Updated almost 9 years ago on . Most recent reply

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Kenny Lewis
  • Real Estate Agent
  • Roseville, CA
13
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58
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How does pml get paid back from buy and holds

Kenny Lewis
  • Real Estate Agent
  • Roseville, CA
Posted

Want to get a better understanding about paying back a pml from a rental property buy. I know for flips that once the property sells that the pml gets paid back from the sale price. But how would I pay a lender back with a rental property since I won't have the purchase amount back with a sale. What's the process? Is it monthly with the cash flow of the property? Advice for pursuading a lender to invest in rental property when the lender wants to be paid back quickly or full payment...

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Steve Vaughan#1 Personal Finance Contributor
  • Rental Property Investor
  • East Wenatchee, WA
16,109
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Steve Vaughan#1 Personal Finance Contributor
  • Rental Property Investor
  • East Wenatchee, WA
Replied

I suppose the BRRR strategy may be best. Buy, renovate, rent, refinance, repeat.

If your deal is a great buy and you force appreciation through improvements, you could refinance your private money lender out provided you can qualify with a bank.

In general, HMLs and other quick payback loans aren't a good fit for buy and holds, though @Kenny Lewis

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