All Forum Posts by: Paul Sanchez

@Nicholas L. haven't been inside the property yet but the units at least appear to be in functional condition. I will know more this week. My numbers may need to be adjusted, but they biggest takeaway I was trying to get from my question is whether or not it is advisable to do BRRRR using a HELOC when rates are climbing and forecasted to climb more by the end of the year, specifically the refinance portion.

@Andrew Postell Thank you for the info! Much appreciated. Makes sense. I’m on the newer side in all of this so thank you for the help.

Yes, looking to get cash out to pay back the 50k. The HELOC has no closing costs or appraisal fee. Incorporated all closing costs in the calculation, still cash flows and excellent ROI. However, if rates increase for the refinance in the 6 month seasoning period, the deal begins to look less favorable. When I run the calcs to refinance at the same rate as the purchase rate, everything's great. When I run the calcs at a higher rate to refinance, not looking too good.

Hi BP community,

I am considering using a HELOC for a 50k down payment on a four-plex. The discounted off market price is 330k with the estimated fair market value at 390k. The mortgage broker has assured me some banks they work with will refinance at 85% LTV.

I am concerned with the refinance after the seasoning period. I have already talked to my refi mortgage broker, have pre-qualified and planned the future refinance in advance, however I am concerned with rising interest rates over the next 6 mo. There is a chance that my refi rate will be higher than the rate at which I bought the house at.

Is this method advisable given probable rising interest rates?

Thanks for any advice in advance!