How Many times can you refinance?

Question

So I know with the BRRRR strategy you start off with either your own capital or borrowed capital until you can refinance. My question is how many times can you refinance. Is there a cap to how many loans you can have? Let’s say you have 10 properties that you refinanced with the BRRRR strategy would you be able to get an 11th property with the same strategy or would you have to wait until the one of the other loans are paid off?

River Sava · Answer

Hey William, great question - Conventional has limits but have you explored non-conventional DSCR loans? They are a great option for situations like the one you described.

Unlike conventional loans, DSCR loans don’t have caps on the number of properties you can finance. They offer a simpler qualification process—no need for personal income verification or debt-to-income ratios. The underwriting is primarily based on the property itself, making it a great option for investors scaling their portfolios quickly. So yes, you can keep refinancing and acquiring properties without worrying about hitting a loan limit.

Happy to connect and discuss further. Also, check out this article for more details: https://www.biggerpockets.com/blog/brrrr-loans-what-are-the-...

Stacy Raskin · Answer

Lenders that offer DSCR loans generally don't have a cap if the mortgage payments are paid on time and the borrower has the credit score, down payment (or equity if a cash out refinance) to qualify. There are seasoning periods which means you have to wait if you want more cash out if the property because of property improvements, time passed or a combination of the two factors. These seasoning periods are usually anywhere from 3-12 months and there are prepayment penalties that range from 0 (buying the prepayment penalty out to 5 years or more). The length of the prepayment penalty is one of the levers on the rate- more on that below. Some investors decide on a one year prepayment penalty or on a term that makes sense for their investment goals.

More on DSCR loans: DSCR loans won't use your income to underwrite the loan.

DSCR loans are based off of down payment, credit score and either actual or market rents so it helps to supercharge an investor's real estate goals and net worth. Here's a bit more in detail about how rates are calculated for DSCR loans:1. Credit score- the higher the best. 760-780+ generally gets best pricing for investment property loans with most lenders. From there every 20 point increment affect pricing differently. So for example, a 761 credit score will be in the 760-779 credit category, then going down to 740-759 and so on.

2. Loan to value ratio: The higher the loan to value ratio (LTV) is, pricing takes a hit. So your pricing will be higher for a 80% LTV loan than for a 60% LTV loan.3. Prepayment penalties- usually 1-5 year terms. The shorter the prepayment term has an impact on increasing the rate.4. Are you cash flowing the property? More on how that is calculated below. Is your DSCR ratio greater than 1-meaning are you cash flowing (according to the lender's criteria of mortgage, property taxes and insurance (and HOA) if applicable). Many lenders will not do a DSCR loan unless cash flowing. If they will do a loan with less than 1, the pricing takes a hit. This criteria is for 1-4 and 5-8 unit programs. I've included an example below to help illustrate this.So different lenders have different rates (which do vary even for DSCR loans) but these are factors they all consider.See example below:DSCR < 1Principal + Interest = $1,700Taxes = $350, Insurance = $100, Association Dues = $50Total PITIA = $2200Rent = $2000DSCR = Rent/PITIA = 2000/2200 = 0.91Since the DSCR is 0.91, we know the expenses are greater than the income of the property.DSCR >1Principal + Interest = $1,500Taxes = $250, Insurance = $100, Association Dues = $25Total PITIA = $1875 Rent = $2300DSCR = Rent/PITIA = 2300/1875 = 1.23

If a purchase, you also generally need reserves / savings to show you have 3-6 month payments of PITIA (principal / interest (mortgage payment), property taxes and insurance and HOA (if applicable). If a cash out refinance, many lenders will allow the cash out to satisfy the reserves requirement.DSCR lenders generally let you vest either individually or as an LLC. It's a great way to increase your net worth and these loans can also be used to pull cash out of a property as it appreciates allowing you to reinvest money into new deals.

Happy to connect to discuss further.

John Morgan · Answer

I got my first 10 properties with conventional loans because the interest rates were a little less (.5-1% lower than DSCR loans). Then I got the rest with DSCR or commercial loans.

Ko Kashiwagi · Answer

Conventional loans will cap at 10, but no limits with DSCR. Typically BRRRR investors use DSCR financing because of lower seasoning requirements. Conventional typically requires 12 months seasoning until you can use newly appraised value.

Craig Warner · Answer

Good advise above and getting all your questions answered. Not cap on how many times you can refinance a property. 10 mortgaged properties is a cap on Conventional Full doc lending and no limits on NonQm and DSCR programs.

Now it gets down to finding a lender who has great rates and great service, that's where I come in.

Let me know how I can help or answers more questions offline if you like.

Thanks

Craig

Andrew Syrios · Answer

Fannie caps the number of loans they'll give to investors at 10. But there are other options available. In my experience, your best bet are local, community banks. Rates will be a bit higher and amortizations likely lower, but there's no such strict limit with them.

Erik Estrada · Answer

It depends on the type of loan. If it's a DSCR based loan, there is no cap on the # of loans.

Connor Hibbs · Answer

Some Lenders do cap by the Fannie Freddie cap of 10, but there are plenty of lenders out there that will not cap you as long as you are able to provide updates on your properties and have a relationship with them. If your main concern is on the refi end the you could also move some properties into portfolios (just make sure that you truly plan to keep these as they may have partial release fees attached).

How Many times can you refinance?

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