Should I BRRRR with the interest rate I landed?

[Steven Silbert]

Could use some advice!

I closed on my second home in December 2020 and managed to land a 2.25% 30 year fixed interest rate. 

The house:

• Purchase: 410,000O
• Owed: 320,000
• Location: Columbia, MD
• Built in 1976 with 2020 ssqft
• 5 bed 3 full bath split foyer

I would like to completely redo the outdated kitchen and baths with a personal loan. I would then take out a cash out refinance to pay off the work and get a down payment for a multi-family. Last time I checked, a house like this was in the upper 400's without the remodel. But! Would it be better to try to rent it out as is considering my current insanely low interest rate? I know it can cash flow as is, but I really would like to get into multifamilies sooner rather than later.

Thanks in advance everyone

[Bob Okenwa]

Let's do the math. Find the difference in cash flow from what it is now to what it would be with the cash out refi. Take the amount you'd get in the cash out and divide that by what it currently cash flows.

How many months/years would it take the current cash flow to equal the cash out refi amount? 

Add the estimated cash flow from the future multi-family and the lower cash flow from the current property after the refi and (presumably) higher rate. If this number is a large enough number to accelerate your investing plans and brings in more money than what you're currently cash flowing, you may want to consider doing the BRRRR.