Hi, I found a place, got a pre approval, have an agent showing me the place, know what it's previously rented for, done my market research for what it could rent for.
Questions are:
Is the refinance loan always 70% of re-appraised value or is it 80% for Madison/Wisconsin?
Is a deal typically not worth doing if you can't get an appraisal / refinancing goal to completely pay back your out of pocket cash and initial loan? hoping to see real examples of Madison Wisconsin. I'm currently looking at 725-727 Vernon ave and 113-115 Georgiana circle Madison Wisconsin and could use some assistance going through the examples. From what I'm seeing I'll have to put down 25% down payment (this is normal for rental real estate apparently) on a 315,000 dollar house that's about 80k so the initial loan is about 240k lets say i get the value of the property to re-appraise for 375,000 and i take out a 70% refinance loan that is about 260k that nets me 40-50k cash, but i could foresee cash on cash return of +250-400 dollars from income.
The mere fact i wouldn't be able to pay off the initial loan + cash loan would indicate to me this would be a no go deal, but I think there is something I'm forgetting to do? Is there a shortcut to understanding what deals to pursue? what i should be looking for in 2-4 unit properties?
