Clarity on Cash-Out Refi

[Clara Levy]

Hi All,

I need some clarity on the last R in BRRRR, the Cash-Out Refi. Think of this like a math question please with a Yes or No answer.

If property is bought at $140K, 25% down meaning $35K. Rented out for $1500. Then 2 years go by. Still rented. And for XYZ/whatever reason the value/appraisal stays at 140K.

And Lender is willing to do a 80% LTV Cash out Refi. Will I really get 80% of $140K, meaning $112K? Even if my equity has barely increased from the initial %25 down? YES?

Or NO? Lender would only give me about 5% of the $140K, meaning $7k? (Because they have to leave 20% of equity in the deal).

Appreciate the clarification in advance.