General BRRRR question

[Account Closed]

While performing analysis on a BRRRR deal I'm noticing that when it comes time to REFI if I underestimate my ARV I could potentially hurt/lower my cashflow due to the higher loan costs I will be required to pay. Is this correct? If so how can I get around this? Obviously having the ARV come in higher than expected is a good issue to have but I don't want my cash flow to be jeopardized. Thanks.

[Joe Aiola]

Hey @Account Closed hit the nail on the head. Like you said yourself, an ARV higher than you were expecting is a good thing.

The one thing I will add is for the possibility of your appraisal coming in lower than expected - if you have the comps to back it up, you can negotiate the appraisal and ask them to look into it again. They talk about negotiating appraisals every now and again on the BP podcast and it usually works.

Best of luck on your journey!