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All Forum Posts by: Fredric Sjöberg

Fredric Sjöberg has started 2 posts and replied 4 times.

Post: Swedish BRRRR investing

Fredric Sjöberg
Pro Member
Posted
  • New to Real Estate
  • Sweden
  • Posts 4
  • Votes 0

Hi everyone! 

Are you a successful BRRRR investor in Sweden?



Would you mind sharing your experience? My two biggest questions are if you when first buying the property would finance with a bank (is there any downsides to that compared to hard money lenders?) and how you then re-finance to get all/most money out, it seems to be hard to get more then 75-80% loan after rehab. 


1. What obstacles do you experience and adjustments did you make to use the BRRRR strategy in Sweden? in relation to using the BRRRR strategy in the US, from my understanding it works a bit different in Sweden with banks, laws & regulations etc

2. Are you using a hard money loan to finance the deal in the first place? Is there a community for hard money lenders? 
- most banks don´t have any closing costs for loans but we have "Lagfart" & "pantbrev" that would be an extra cost. 

3. Re-finance 
Apparently it´s pretty hard to get more than 75-80% loan on your re-finance in Sweden, has anyone managed to get all or most of their money back afterwards? 


I´m happy to discuss this further if anyone has Dos & Don´ts experience, 


As far as I know there is pretty limited information in podcasts/communities/FB groups etc with investors in Sweden, so if you know of any feel free to share, or if anyone wants to start a "BP Sweden group" to have more discussions I would be down for that!

If you are an investor or just getting started to invest in Sweden feel free to connect with me or send me a message and we can help each other out.



All the best!  

Post: BRRRR - Short term loan - Refinance

Fredric Sjöberg
Pro Member
Posted
  • New to Real Estate
  • Sweden
  • Posts 4
  • Votes 0
Originally posted by @Ulf Mansson:

Hi Fredric and everyone else!

I can add to this with experience from the Swedish market. What you do after you done the renovation is a new valuation of the property. It needs to be done by an appointed valuation firm from your bank, they will give you a list of companies to contact. Based on that valuation you can refinance. The biggest problem in Sweden, has been for a couple of years, is that it's really hard to get more than 75-80% loan on the property based on the valuation. 

You stated that you received a pre-approved loan of only 15% down, that's really good. But at the same time, I think you need to talk with the bank right away about your strategy to refinance after the rehab. Or go for the other solution, find a new bank after a year and refinance then.

We don't have any closing fees and other fees in Sweden as long as you don't sign up for a fixed interest rate for several years. The cost you have to pay to refinance is the cost for "pantbrev" (sorry don't know the english term for it). The cost is 2% of the amount you want increase your loan with.

Hope this helps! Good luck

Hi Ulf, 

Thanks for sharing your experience. 
Yes, I am aware of the re-valuation of the property that needs to be done with a third-party company.  

Okey, thanks for letting me know that it´s likely to only get 75-80% loan after rehab you can have on your property.

I´m about to contact the bank about a property we are looking at and ask about the refinance process after rehab in general, my bother and I set aside 300k together for downpayment and got a pre-approval for 2 million SEK, that makes it 15% DP. I like the solution of going to another bank to refinance.

I am a little bit hesitant to go to a private money lender at first for some reason, do you have any experience with that? 

Thanks for the remainder of the "Pantbrev" I have that included in my calculation. 


Thanks Ulf 

Post: BRRRR - Short term loan - Refinance

Fredric Sjöberg
Pro Member
Posted
  • New to Real Estate
  • Sweden
  • Posts 4
  • Votes 0
Originally posted by @Nick Van Sicklen:

Hi @Jones Larhnimi and @Fredric Sjöberg. I am an American, living in Stockholm now. I have done the BRRR strategy a bunch in the US and own about 10 properties in the US. I have been starting to look into similar options in Sweden. The mortgage/amortization set-up in Sweden is pretty different to the US approach (where BRRR is really effective). I still think it is doable, but there is no re-finance (cash-out re-fi) solution in Sweden. I think the strategy here is BUY, REHAB and RENT....no REFINANCE. Happy to chat more.


Hi Nick, 

Thank you for engaging in the post and sorry for my late response, I´ve had some fires to put out lately. 
Could you further explain why the re-finance step won´t work in Sweden? 

My brother and I just got pre-qualified for a mortgage at the bank, I was under the impression that there are no loan "closing fees" to have or start a new loan with the bank or to re-finance with the bank after rehab if your bank is financing the distressed property in the first place. 

 Happy to talk more about this, I´m going to start a new thread to see if I can attract other Swede´s and see what they are doing. 


Also, thanks a lot to everyone for sharing their knowledge and experience! 

Post: BRRRR - Short term loan - Refinance

Fredric Sjöberg
Pro Member
Posted
  • New to Real Estate
  • Sweden
  • Posts 4
  • Votes 0

Hi Everyone! 

I´m new to this community and very excited to have found it! My brother and I are just learning and have started to look for our first investment property, we are focusing on the BRRRR strategy in single/duplex family houses back in Sweden. I have a pretty good idea of how this strategy works.

I´m sure this has been mentioned in Podcast, books and blog posts before, I was hoping that someone could just clear the fog quickly and before I dive deeper into the strategy. 

My question is: 

Do you, or does it matter how you get the money in the first place to buy your property?
Can you use the bank or is it better to find a hard money lender(?) to finance the place to buy? And why is this?  

My brother and I are planning to use the regular bank to finance our first purchase, we pay 15% downpayment. 
- rehab it
-rent it
-Appraise and refinance with the same bank
-repeat. 

Are we missing something here? is there a downside with using the bank to first finance your purchase? 

If you can please explain it or refer to blog posts, videos etc. I´m looking to buy the BRRRR book and I´m sure it's covered in that.
 

Thanks in advance