BRRRR with CASH?

[Robert Sadler]

Quickquestion...

Looking at my First BRRRR deal. I have enough to buy the house with cash and do the renovations. Once I have completed the renovations and have it rented, I can then refinance the house (to my understanding). My question is would this be a regular 30 yr loan or would this be another type of loan since I paid cash for everything? It will be in my LLC but it seems like I will be financing what I already own. Thanks

[Michael Dumler]

@Robert Sadler, you can refinance via a conventional loan or asset-based loan product (DSCR) since the property will be held as a rental. It all depends on the terms and rates of the loan and what would make the most financially sound and structured sense to pull your money back out. Most of these lending products are 30-year terms but can vary as well. Borrower qualification will differ between the two. For instance, a conventional lender will still take into account your income, employment history, credit score, and DTI. Moreover, an asset-based refinance will underwrite the loan based on the projected income performance of the property. Hope this all makes sense and helps!