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BRRRR Method: Cash Out Refinance to Make Money TAX FREE Investing in Real Estate

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The fastest way to make money TAX FREE in real estate is the "BRRRR" method of real estate investing (which stands for "Buy-Rehab-Rent-Refinance-Repeat"). It is also known as the cash out refinance method. It's low risk, cash flow focused income property approach generates more money, even faster than flipping (without the tax drag of capital gains).
The BRRRR strategy is so effective because it allows you to deploy your money and get it right back (refinance), allowing you to recycle that capital into another deal (and repeat it again).
With the BRRRR strategy you build wealth so quickly because it allows you to control a real estate asset with little to no money of your own in the deal (after the refinance). This allows you to, essentially, have an infinite return on investment (ROI) on every deal. The infinite return comes from not having any money into the deal, and possibly even making some money at the end of the deal (cash in your pocket), plus passive cash flow each and every month thereafter. I've used this strategy over 50 times now in Canada, but it can be done anywhere in the world where you can buy a property and add value through renovation or rent increases (so basically anywhere).
Instagram: @mikerosehart for daily content & stories!
#brrrr #cashout #refinance #tax-free
#investing #incomeproperty #money
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Music: www.bensound.c...
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28 авг 2024

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Комментарии : 426

@Chris-sx4qw 5 лет назад

awesome vid man very simple to understand cool bro

@MikeRosehart 5 лет назад

Razor Morris thanks 🙏

@dorcasbill5966 4 года назад

Trading as a beginner was very difficult due to lack on trading experience, this resulted in losing my funds though I've been able to recover all that I lost, all thanks to Mr Charles_forex09 on Instagram , i never knew good trader still existed till I come in touch with him_

@osmanxxrngxx1369 3 года назад

@@MikeRosehart hi l have qst is when refenince does the bank want the money back when You refinance

@minaja14 2 года назад

@@MikeRosehart how do you find properties less than market value to get started?

@elleciahayes9975 3 года назад

You sir....have gained a subscriber. I'm a realtor here and my husband is an investor and I'm working harder this yr to educate myself more on this subject. We have 4 rentals and you broke this down soooo plain and simple. Thanks!

@ryanthepianoman27 2 года назад

How many now?

@molindarosechannel3550 2 года назад

No one has ever explained this the way you did for me today. Thank you very much for taking the time to do this

@waneframe 3 года назад

The pull out method 😅🤣😂🤣😅 that's a good one!

@cubedmack 2 года назад

This has to be the BEST example of the BRRRR!

@jazzbo2223 Год назад

This video was very good man , I just bought my first rental property. Now this video just pushed me forward 🙏🏾✌🏾

@MikeRosehart Год назад

Let’s go wooo.

@MikeRosehart 5 лет назад

This strategy works in recessions or bull markets. In recessions deals can be negotiated and cashflow is great due to flat rents, in bull markets you have to work hard to find deals but you get appreciation on your deal & it’s easy to refi for high. I actually prefer BRRRRing in recessions. I’m excited to do a video on each stage of the BRRRR in the next 6 weeks. How to buy a BRRRR (negotiate etc), how to renovate & rehab on a budget to add maximum value, how to get maximum rents, how to refinance 80% loan to value, and pull all your money out while still getting 500-1000/month positive cashflow. If worst case you fail first time around on the refinance, you should still have cashflow and can always refinance again :)

@MikeRosehart 5 лет назад

#pulloutmethod #cashpullout Who can tell me at what time in the video I drop the pullout method joke?

@jacobanthony3260 5 лет назад

2:24 lol

@got.o1296 5 лет назад

02:24

@MikeRosehart 5 лет назад

Jacob L lol

@MikeRosehart 5 лет назад

Go T.o you’re watching ;)

@dsinformation6640 5 лет назад

Thanks for the video. I have to admit your two jokes were funny!

@MikeRosehart 5 лет назад

haha - thanks!!

@613rsps 5 лет назад

Very detailed video with an easy understanding of the BRRRR Mike! Great video as always!

@MikeRosehart 5 лет назад

Thanks Tommy!

@joselliott6 4 года назад

I like this video... the only one that really explained things completely. BUT some of the filler clips were NOT need.. it was very distracting .

@antoniorao5345 3 года назад

Thank you for a detailed description in something that I was curious about. Subscribed.

@MikeRosehart 3 года назад

👌

@konstgam4809 5 лет назад

I can't wait for next videos in this series about BRRRR! Great job as usual!!!

@MikeRosehart 5 лет назад

Thanks 🙏

@jz1536 3 года назад

Probably the best explanation of Brrrr I’ve seen. Thanks

@TheLifeJOGJourneyofGrowth 4 года назад

Discovered the BRRR through Bigger Pocket. Thank you for sharing your analogy on this strategy. I don't know how it will work in Quebec because the buying market is pretty high.

@wyecroft1 5 лет назад

Great video Mike! Love the new whiteboard. Looking forward to doing some other BRRRR's in the near future!

@MikeRosehart 5 лет назад

Sounds good! Me too! THanks!!

@josephs203 5 лет назад

Wow this actually made so much sense I love it

@MikeRosehart 5 лет назад

Thanks! It’s my favourite method. It’s actually indexing now too after I took it down and reuploaded

@Mx199D 4 года назад

Should look into BiggerPockets too if you want to know more about the strategy

@robertcolon4998 2 года назад

Great way to break it down your videos are so helpful I want to try this I just got my fixer upper

@stephenbland2408 4 года назад

I love the pull out method ;) haha

@honestly101 5 лет назад

Wow! 22 comments and I am only 2 hours late to the party. Awesome Mike Rosehart! Your getting lots of interactions with us the subs. Thank you for breaking down this strategy, lots of us dont have that much experience or the know it all to excute this strategy successfully!

@MikeRosehart 5 лет назад

Thanks Noel! I always appreciate your support! It actually was unlisted for the first hour. So only people with the link on my fb or insta could see it.

@Royaltvmounting 4 года назад

I've watched a ton of videos on this. you made it real simple to understand thanks!

@MikeRosehart 4 года назад

SuperBlakk Truth aw thanks 😊

@apoorvpatel6286 3 года назад

You are a good man.👍great videos

@MikeRosehart 3 года назад

🙏

@austinyeh6 5 лет назад

I see your Videos are blowing up! Really well explained and super thorough. Literally blew my portfolio through BRRRRing.

@MikeRosehart 5 лет назад

Austin FI Yeh thanks Austin - I keep trying to grind it. This one has great engagement with my subscriber base, but literally 0 algorithm push. No RU-vid search or recommended. 100% like ratio on over 120 likes is decent in the first day though.

@MikeRosehart 5 лет назад

Austin FI Yeh you are a young Real Estate investors GOAT. 0-10 units super fast! :)

@austinyeh6 5 лет назад

Title and thumbnail on point though. Just make fart videos and go viral "millionaire farts". Not near GOAT status yet :P. Not even close man. Thanks for the support though - Just taking it one deal at a time 🙌

@inferno46n2 5 лет назад

You should do a video on how to find these type of properties. As a newbie I find it extremely difficult to pin point a house that only requires "strategic renos". The idea of the BRRRR makes perfect sense, I just get extremely overwhelmed when looking for the type of property to apply it to ( note I am in the Calgary area for reference )

@MikeRosehart 5 лет назад

inferno46n2 will do! it’s definitely coming!

@MikeRosehart 5 лет назад

inferno46n2 it’s do-able in any market.

@inferno46n2 5 лет назад

@@MikeRosehart I look forward to it. Thank you!

@MikeRosehart 5 лет назад

inferno46n2 ❤️

@LB-ue9ef 3 года назад

That’s exactly what I’m talking about how to find them.

@matthewkauffmann982 4 года назад

Most of this makes sense except being able to do it with 3 more houses instantly. No one is going to loan you that unless you can prove you have massive income streams.

@josephogz 3 года назад

true, how are banks lending you multiple mortgages/ refinances? really confused here

@corbingray744 3 года назад

I think you can bring them a portfolio but you would have to do it once already so you would need some source of income the first time

@seandonahue1092 2 года назад

Hard money lenders don't care about income

@Mr.Moneybags40 4 года назад

hey mike, im brand new to your channel, I'm new to investing, I'm a real estate agent in nyc, been reading a lot of books on investing thru out my quarantine time at home. loved your whiteboard explanation, your teaching style is very easy to understand.

@MikeRosehart 4 года назад

Erwin 😊

@stockmarkethustler6425 3 года назад

Lol they way he say “tonnnn of money” 🤣

@Coast_to_Coast 5 лет назад

Awesome job Mike. Keep up the great videos!

@MikeRosehart 5 лет назад

Steven Cacace thanks 🙏

@nikk9516 3 года назад

Absolute gold! Loved the way you explained it mate :)

@MikeRosehart 3 года назад

Thanks :)

@LB-ue9ef 3 года назад

That was explained well, I have renovated my home by myself and still working on it

@catjav5603 3 года назад

This is so informative. I am a beginner and would love to hear the tips. Thanks for making this video!

@miketrotter2975 4 года назад

Mike, love the videos. Appreciate you putting yourself out there. You are about the only good thing that has come from reluctantly listening to the CBC on my commute. I figured if they were taking a dim view on you that you must be doing something right. And I was right. Question for you. How do you manage to get bank financing on your 2nd, 3rd, 4th property? Especially after you quit your day job. Making 90k, bank seems to only want to give me 300-400k and wont count the rental income as part of my income.

@davidalas8569 Год назад

Sounds good I still flip the property and do it again and again

@edmilization 3 года назад

Thanks for explaining this!

@willtrigoso5861 4 года назад

Best Video on BRRRR compare to the others. Thank you... Pull out game baby! lol

@MikeRosehart 4 года назад

William Trigoso aww thanks 😊 🤣

@dandesveaux1112 5 лет назад

great video mike. i just sent it to my investors as a guide to investing with me. really good.

@MikeRosehart 5 лет назад

Dan Desveaux love it! Happy To help Dan! :)

@MikeRosehart 5 лет назад

Dan Desveaux this comment made my day

@talha3183 4 года назад

Thanks I was so confused and your video made it so easy to understand 😊

@MikeRosehart 4 года назад

Talha 👌 thanks

@dontrinh7686 5 лет назад

Mike, I love this strategy, thanks for re explaining it to us in a way that anyone can understand. I invest in student rentals and would like to know if this brrrr method would work. I figured, the only way you can do this is if you buy cheap enough. If you know ways of improving value of a property with student rentals (bedroom additions) in mind, I would love for you to share! Thank you sir.

@MikeRosehart 5 лет назад

don trinh the strategies definitely work on student rentals. I’ve brrrr’d lots of them

@GavinvanRooyen 5 лет назад

So great we both share a passion for this 💰

@MikeRosehart 5 лет назад

❤️

@Dave33202 3 года назад

Thank you very much for the content your sharing with us. your channel is much help to me and great motivation with helping me figure out how to get started in real estate investing using the Brrrr method. I am looking forward to more videos from you mike

@AlecMendez1 5 лет назад

That joke though, lol that was great my guy

@MikeRosehart 5 лет назад

:D I'm glad you enjoyed it. BRRRR our way to financial freedom! #LUXFIRE

@frapeyou 5 лет назад

OH MY around the 10 minutes into the video where you say take out the money tax-free, just blew my mind, I heard of the brrrr method but the way you explained it, its way more advantageous then I imagined, mostly the tax free part, cause as you know, our tax rates are ridiculous, thank you so much and also where in Canada do you buy your properties?

@MikeRosehart 5 лет назад

I like Southwestern Ontario, mostly London

@MikeRosehart 5 лет назад

Glad to have blown your mind re tax free :) That’s the best part. It’s basically a 1031 for Canada

@frapeyou 5 лет назад

@@MikeRosehart ya, everytime I hear about the 1031 exchange, Im sad that Canada does not have something like that, well I guess they do but it different XD

@brentshuffler1234 5 лет назад

Perhaps, your speed of acquisitions is the result of a few extraordinary factors? E.g., [1] living in a fast-growing property-market. [2] Living in an advanced country with a prosperous and growing economy. [3] Having professionals (e.g., bankers, financiers, lawyers, etc.) that work quickly to close transactions in days or weeks versus months or years as in other parts of the country/world.

@MikeRosehart 5 лет назад

I’ve been doing it in years where appreciation was 1%. It actually works better in a recession. It’s harder to do during a booming market because you can’t find or negotiate the deals. Trades are harder to find/get.

@rickymagicanada 5 лет назад

Great channel, awesome information Mike. Thank you

@MikeRosehart 5 лет назад

Ricardo Leon welcome to my channel! And thanks ! 🙏 Lots more where this came from :)

@c0c0boi12 3 года назад

Thank you for your example of the BRRRR strategy. Btw you’re good looking too. 😉

@1ofnoother 3 года назад

Can you make a video about how to go about finding the right property in the right area please? Everyone says money is made when you BUY, meaning you have to buy low. But where do we find distressed fixer upper properties that aren't too damaged and will cost too much to rehab? How would we know this? Hire a contractor? That's the stage I'm at I think. I have the funds for a down payment, or several depending on the price. I have excellent credit, so I should get the best rates. I own a primary residence. I think I need to get a rental in order to increase cash flow to get more rental properties.

@JesseFragale 3 года назад

Great video Mike!

@thewolfofmainstreet6600 5 лет назад

My pull out game is strong. (BRRRR)

@JesseFragale 3 года назад

😆

@MikeRosehart 5 лет назад

#pulloutmethod #cashpullout Who can tell me at what time in the video I drop the pullout method joke?

@dsinformation6640 5 лет назад

2:23 - 2:26 minute

@c0c0boi12 3 года назад

I wouldn’t recommend that method lol 😂

@trinik95 4 года назад

I'd love to read a book by you on this and all your combined strategies.

@MikeRosehart 4 года назад

trinik95 if I have the time I’ll write some books 😂

@saywhatsaywhat 3 года назад

New Sub here...great video! Thanks for sharing!

@CHernandez89 4 года назад

love the video! very simple. I want to start doing this.

@MikeRosehart 4 года назад

Camilo Hernandez try it out :) tax free eligible dividends

@CHernandez89 4 года назад

@@MikeRosehart I am looking to start this year. I am going to get pre approval first from a broker and to start looking

@leocreation9595 3 года назад

The pull out method😂 liked!

@brentshuffler1234 5 лет назад

I personally had the experience of taking several years to sell a property that we had [1] bought at a great price during a previous recession (early 1990s was even worse than the Great Recession of 2008 to 2009), [2] renovated, [3] rented well, [4] refinanced, and so forth. No buyers when the next recession came in 2009. Years passed before we could find one serious buyer . . . who then took years to get all the necessary financing in place.

@MikeRosehart 5 лет назад

Good thing you bought for cashflow - the BRRRR can’t fail - worst case is you have $1,000/month in cashflow.

@brentshuffler1234 5 лет назад

@@MikeRosehart Part 1: It sounds good, but the reality is, and can be, far worse: e.g., during and since the Great recession, the pool of qualified tenants declined, and people were looking for reduced rents, rather than the same or better than what we had enjoyed pre-crisis.

@brentshuffler1234 5 лет назад

@@MikeRosehart Part 2: Another compounding risk for landlords is periods of vacancy or part-vacancy. The combination of less than 100% tenancy and reduced or falling rental yields is a double wammy for landlords. I experienced this many times since April, 2009.

@brentshuffler1234 5 лет назад

@@MikeRosehart Part 3: In a recessionary environment, many people suffer job-losses, business challenges, and/or cuts in work-hours and/or salaries and benefits. It depresses the number of potential buyers/tenants and also reduces the average income that persons have for buying/renting properties. So landlords must be prepared for times of no/lower inflow.

@brentshuffler1234 5 лет назад

@@MikeRosehart Part 4: Some parts of the world have still not recovered from the recession of 2008 to 2009. This means that property-values have fallen significantly and/or not recovered and/or are STILL FALLING . . . TEN years later.

@WeBuyFast 4 года назад

Great video!

@richardrodriguezrodriguez9201 5 лет назад

I am an international student here in the U.S., so my income opportunities are largely reduced. Still, I will give this try as soon as I get the chance to do so. I heard the podcast you did with Jonathan Levi, and I remember you said you were working during some time. So, as I prepare for applying this principles, I’d love to know what kind of advice you would share with me about producing income as a student (who’s not allowed to work in the US)

@alexshaffer6609 3 года назад

Great video man. Would you also consider the money paid back I into the mortgage as profit in a sense? At the end of the this you are receiving $2500 a month in rent and paying 1400 to the mortgage and maybe keeping around $1000 after property tax BUT that $1400 going to the mortgage is essentially going to the equity of the home that you own. So aren’t you also increasing your net worth by about 17k a year in addition to everything else? Minus the interest of course.

@thestatslab2447 2 года назад

15 * 17000 = 255000 , about 40% should be paid in taxes, cashflow will not cover this expense. It is not sustainable. Please someone explain how are you handling that, or all this is just theory?

@justmoney139 5 лет назад

Amazing video! Thank you for the awesome content, I'm really looking forward to your next video! The biggest thing I want to learn is how to buy houses below market value and what type of homes are best to make rental projects. What tools should you use to find properties and how to access whole sale homes in Canada.

@MikeRosehart 5 лет назад

Join my Deal email list :) Lol I’ve got 2 right now that are partial BRRRRs near the college.

@MikeRosehart 5 лет назад

Thanks Jake!

@ssyed4414 5 лет назад

@@MikeRosehart how do I join your deal email list?

@justmoney139 5 лет назад

@@MikeRosehart Great I'd love to, how do I join your email? Thanks!

@MikeRosehart 5 лет назад

Jake email with your name, email and number to roshartproperties@gmail.com

@dadjbig 4 года назад

Awesome video , thank you

@anthonygiuliano1839 5 лет назад

Great video! Thanks!

@MikeRosehart 5 лет назад

Anthony Giuliano thanks 🙏 Appreciate the feedback, we worked hard on it.

@GaryOutdoorsLiving 4 года назад

Wao,. Best explanation I've seen. Working on this next.

@MikeRosehart 4 года назад

Hector GaryD Dominguez thanks 😊

@papercut1987 3 года назад

Hi Mike, thank you for this great video. Could you talk about the common mistakes or pitfalls that we should be watching out for during this process? Thanks~

@joanyraquel 5 лет назад

When you take a home equity loan, this is not free money, this is money that you owe the bank and you have to pay monthly. If you use part of that money to pay the remaining balance of your original mortgage (in this case the $ 160 K), you still owe the total $260K to the bank and you will be paying for this with monthly home equity loan payments. Did I miss something?

@MikeRosehart 5 лет назад

Exactly. You have 0 of your money on the property. It’s all back in your account. The properties cashflow and more than service the debt payments so it’s as if they don’t even exist. Properties I buy cashflow $1000/month after mortgage, and all expenses. So even with vacancies I don’t worry about the debt payments. The idea is you borrow that money out of the property equity at 2-3.5%, and invest it in more property down payments where it can grow at 10, 20, even 100% ROI, and you make the difference.

@ddcarl8 4 года назад

math doesnt add up to me

@Its_andrewdude 4 года назад

derek carlton pretty simple math really. 200k house. He put 40k for a down payment and financed 160k with 23k for repairs. So total out of pocket is 63k(minus closing costs) with a 160k mortgage. New appraisal is 325k after repairs are made and property is cash flowing consistently. He refinanced with the bank(80% of appraised value is typical) which gives you 260k. 260k(new mortgage) pays off 160k(old mortgage)= 100k. 100k-63k(original money out of pocket)=37k left over to pay yourself and/or put into a new home. Now I’m assuming these numbers that he used are made up. Because one thing I don’t agree with is the amount of cash flow he expects to be receiving each month. At least net cash flow. There was an 1,100/ month spread after debt service, but before vacancy, repairs, taxes, insurance, Cap. Ex., or property management were taken into consideration. Not that it would necessarily be a bad deal after all accounted for, but it definitely wouldn’t be $1,000/month in your pocket.

@gh-dw3tg 2 года назад

@@Its_andrewdude I agree.

@mattwhitney8202 3 года назад

Hi Mike, loving your videos so far. I agree that the biggest hurdle for most people is being able to accurately predict the costs and complexity of a renovation and understanding how much value it will add. Basically, how do you find the sweet spot between a minimum investment for maximize ARV? How do you know if a contractor is charging a fair price? How do you save on renovations without having to do everything yourself? When searching for deals, I feel like you need to know the projected renovation costs before purchasing so you can effectively analyze the deal. But if you’ve never done a high profile renovation before, how do you know how much it will cost? As I work through your channel, do you have a recommendation on certain videos or live streams to watch that address this?

@cheskie24 2 года назад

these are all very good questions that i need answers immediately

@SoyRamosDeRamos 3 года назад

Love this video !!!

@MikeRosehart 3 года назад

Thanks 😊

@parade8 4 года назад

I’ve started to do this, but hit a barrier. I have a few properties personally and my debt service , when you include all the mortgages is too high to get another mortgage. 2) opened a Corp and did the same but rates are about 1-2% higher. How did you get around this. 3) when i did a Brrr, my bank won’t lend on appraised value until the property has been owned for two years (rbc) what bank are you using to do this without waiting. Loved the video. Solid!

@MikeRosehart 4 года назад

parade8 try another bank.

@MikeRosehart 4 года назад

parade8 keep at it, it’s a tough grind

@marisa42 3 года назад

When you refi and buy another house which one do you consider your house and which one your secondary loan

@robabir1344 4 года назад

Your really awesome man. Thanks for sharing

@MikeRosehart 4 года назад

Np happy to help!

@pawanj08 5 лет назад

Not sure if I missed but there were a lot of cost missed like Closing cost of buying any property like land transfer tax lawyers etc reason they all take a cut out of your net equity even for refi purposes plus 1% rental of the property purchase Price is completely unrealistic.. may be you can enlighten me more on that.

@MikeRosehart 5 лет назад

pawandeep jaggi they’ve been addressed. The closing costs are typically 1% of the closing costs. Does it change the BRRRR at all? I’d still have all of my money out and then some.

@b23902390 4 года назад

Thanks Pawandeep for asking about the cost of a refinance. I was scrolling through the questions to see if it was explained and how that impacts the bottom line.

@TheDuncoh 5 лет назад

Great video Mike! appreciate the content. Was the type of mortgage in this scenario a purchase plus improvements mortgage?

@MikeRosehart 5 лет назад

Duncan Pratt in this scenario it wasn’t. PPI mortgages can’t be full BRRRRs, only partials usually.

@MikeRosehart 5 лет назад

Duncan Pratt thanks 🙏

@TheDuncoh 5 лет назад

@@MikeRosehart so the mortgage was just a standard mortgage from a conventional lender?

@livzz1419 5 лет назад

great content!

@MikeRosehart 5 лет назад

OLINDA E thanks 🙏

@emmanuellebon7810 4 года назад

missing a lot of numbers here (property taxes, closing cost, refinance costs...etc)... but good video!!

@MikeRosehart 4 года назад

Emmanuel LE BON accounted for in the reno budget would be the carrying costs, and the principle is the same with or without major refi costs

@brentshuffler1234 5 лет назад

I fully enjoy your overall strategy, but I am curious what you would do if the lenders in your area/country required loan to market value of not more than 60% versus 80%? In my experience, once lenders realise that you are not a residential buyer, but a portfolio real-estate investor, corporate lending applies. Then, the rules and parameters are much more conservative (e.g., first-time home-buyers can qualify for up to 100% lending and be able to take up to $25,000 from a registered retirement-plan tax-free towards that first-time purchase) . . .

@MikeRosehart 5 лет назад

It definitely works anywhere. I used to have limiting beliefs around financing - then I realized I didn’t have the right mortgage brokers or financing people.

@MikeRosehart 5 лет назад

What market are you in?

@MikeRosehart 5 лет назад

I have 50 properties and I still borrow 75% LTV all day :) credit unions are great and small business loans 80% loan to value are great too for rental properties once you have 10-20+++ buildings.

@brentshuffler1234 5 лет назад

@@MikeRosehart Most of that experience relates to the Caribbean since the mid-1980s, and Barbados in particular. It is one of the countries (others being Greece, Portugal, Italy, Spain, Iceland, Venezuela, and Ireland) that had a deep recession following what happened in the U.S.A. during years 2007 to 2009, and then stagnated/declined for the next ten years. There was some recovery during years 2015 to 2017 (though not enough to recover to pre-2008 levels) and then it went into economic recession again in year 2018 to present.

@brentshuffler1234 5 лет назад

@@MikeRosehart In all previous generations, Barbados like other Caribbean countries had a long history of reliable appreciation of real assets, but the years post-2008 brought shocking crashes of up to 40% to 50% in home-valuations, i.e., depreciation, and we have witnessed an entire lost decade, with no clarity about how long it will take to recover just to where things were c. year 2007.

@Fabi.29 5 лет назад

Great video and great jokes!! I need some help. I undersatnd the 20% down= $40,000 and the 80% loan=$160,000. Where I'm lost at is the RENO cost. Is that coming from my money/capital or does the RENO cost come from the $160,000 loan from the 80% of the house. Basically to make it more simple in case my question is a little confusing. Is the Reno cost coming out of my pocket/side or from the 80% loan. Thank you, in advance.

@MikeRosehart 5 лет назад

Fabian Martinez yes it (the reno) comes out of your pocket but you get the money back (reno and downpayment) on the refinance.

@Fabi.29 5 лет назад

Thank you for a fast reply, liked and subscribed, have a good day!!

@pierrebadin 2 года назад

Very interesting video. Not fully sure I understand how you're able to take money out "tax free" after you refi.. Yes, you pay back your initial loan and have some extra left over, but you'll still have to make payments, so it's not like you can go on a spending spree.. I'm confused there..

@eliho16 3 года назад

great explanation but I assume you need the 200-250k to invest on hand right?

@MikeRosehart 3 года назад

More is better, but less is possible. Depending on prices in your area.

@Matt-Legrand Год назад

For the 260k loan, where is DP factor in your equation? You’re missing closing cost in your numbers as well

@jeffqu9601 3 года назад

Hi there, thanks for the video and your time. I’m from Canada, too. How do you refinance if the banks don’t do it according to the equity in the house but the person’s income?

@MikeRosehart 3 года назад

Some banks will lend on net worth. Some credit union etc. If you really can’t find a good lended, find a B tier lender OR just sell :)

@raventaylor9557 4 года назад

What if I have a property that i paid cash for and renovated it and rented it... what is the best option for me? Just do a traditional mortgage to get my money out?

@Mr.LA562 3 года назад

What do you renovate to bring the home value up ??? And whats the ideal amount to spend doing the renovation

@lilychen8195 5 лет назад

Great video. You talked about being a private lender in another video. How can we do that?

@rafaelfernandes2267 3 года назад

Hello Mike, thanks for the great video. I have a question related with the cash re-fi process: At the beggining we have 40K in equity, which will be paid with the refinancing. The question is: To have this refinance, I need to have 20% of the new loan, in equity, in order to get the deal approved, right? How do you get this 65K Equity of the new Loan? Thank you and keep up the great work & content!

@MikeRosehart 3 года назад

Initially funded by savings or private money, and you create the equity in the deal by adding value to it.

@rafaelfernandes2267 3 года назад

@@MikeRosehart thanks a lot for your reply! What exactly does that mean? Even with a great value property, I always need to put those 65K in equity on the deal. Or could it be related with a different kind of debt (higher interest rates than the loan)? Thanks for the great work & content! 🙌🙌

@josephogz 3 года назад

so your refinance is like your new mortgage and you use the equity from that to pay new downpayment but you'll have to qualify again for a new mortgage? so basically you have two loans - the refinance and mortgage? and bank allows multiple refinance/ mortgages? or you have to sell one? what if you want to hold for rental income, is this strategy still viable?

@dr.tobiaspihl770 3 года назад

1% back each month just from the rent? IMPOSSIBLE where I live. Usual senario here (Norway) is a 500 000 dollar house with 2 units rents for 2500/month. I found a property for 530 000 that rents for 3600/month, which is pretty good. Including value increase of an average of 4-5% though... then the numbers are completely different.

@stacymoreau5492 4 года назад

Thanks for the video. Do you do your refi with the original financial institution? If not, aren’t you paying early cancellation fees along with new notary/lawyer fees?

@MikeRosehart 4 года назад

Stacy Moreau sometimes you can get them waved.

@MikeRosehart 4 года назад

Stacy Moreau you can go elsewhere or refi with the same institution, often they’ll waive the fees.

@slackerjo 5 лет назад

Mike do you have a budget for buying your properties or just follow the 1% rule? This week at work I explained BRRRR to a co-worker and when I said "re finance" he immediately reacted and I didn't really need to explain the math as he was already doing the calculations in his head.

@MikeRosehart 5 лет назад

Haha -I buy anything that cash-flows or is undervalued. sounds like a smart guy :) Full Cash-Out Refinance is basically a BRRRR

@tylermurphy2091 3 года назад

I always understand everything up to the refinance. When refinancing why is it better for the mortgage loan to be way higher than the initial mortgage? Can you clear this up for me! Great video though 👍🏼👍🏼

@MikeRosehart 3 года назад

To pull your money out at a low interest rate.

@user_abcxyzz 4 года назад

Recently came across this channel. Great content. I am the bay area and looking to partner/build a team. I just came from Mike's video where he breaks down the basic requirements for starting. If someone In the bay area meets those and wants to conversate let's chat!

@alcze 5 лет назад

Great video! Plan to buy my first BRRRR shortly. I live in Mississauga what do you think about buying in Sauga? Any cities in Ontario you recommend buying in? Also any suggestions on finding an agent that can find me these under market deals? Thanks for your help!

@MikeRosehart 5 лет назад

Alan Czechowski I have an agent team in London, I’m not extremely bullish on the cashflow in Sauga or Toronto really for that matter.

@alcze 5 лет назад

@@MikeRosehart ok that's what I thought. So you recommend I try in London with your team? How about the tri cities (kit, Waterloo, Cambridge?) What's your opinion and do you have any agents in those cities?

@MikeRosehart 5 лет назад

I'd say yes - they can help you find a great deal in london. The cashflow is stronger in London if you know where to look. I wish I could help in those areas but I don't have a team of agents (I'm an agent myself, but I mostly just outsource to my team and help with the investment analysis).

@marivicmaniego9176 4 года назад

Is london ontario is great for investment compare to the gta ontario

@GAINSLAYERMUSIC 4 года назад

If I own my own home with about 80k in equity but don't have a lot of cash upfront to start this process, would it be wise for me to refi and use that money to start this process or would that be risky since I wouldn't have renters that pay the mortgage? My day job isn't going anywhere so it seems like I could potentially start this way but not sure what the risks would be or if there are other options. Love the video though and I subbed!

@gail5095 4 года назад

You could always get a HELOC then you can use that money when you want and it costs you zero interest until you do use it and your mortgage stays the same.

@JR-bp7gn 4 года назад

Hi Mike! Thanks for the video. Quick question how do you count the interest payments made to the HML during rehab in your calculations?

@MikeRosehart 4 года назад

JR carrying costs

@ivanleon8898 4 года назад

The problem I'm having currently with this strategy is that the hard money loan that I'm using for the purchase and repair is only good for 6 months, and the banks that I've talked to so far wants me to own the property for 6 months before I'm able to refinance.

@thierrysuhubiette3544 5 лет назад

How do you find those buys? Strategies to find a Brrrable property? Thanks so much.

@MikeRosehart 5 лет назад

All sources on market and off

@thierrysuhubiette3544 5 лет назад

@@MikeRosehart Merci!

@carmelolocasto1 4 года назад

What about your new mortgage. Wouldn't you owe money on your new mortgage. I understand that you paid off the first one. But what about the second mortgage you took out .

@jaysjunkremoval7798 2 года назад

I just bought a house last year for $295,000 and I just did a appraisal and now it appraisal for $395,000 If I refinance can I keep money for my self ? Thanks for info🙏

@5rmorehouse 4 года назад

I think that this is a great plan for building up a large portfolio quickly, but I have 2 concerns. 1st - reduced cash flow after refi. There's no getting away from that. The note is going up and going to cut deeper into the rent being collected. I'm sure that some of this can be mitigated by finding super deals, where houses are priced well below market with minimal work needed in the reno, but these deals don't come along every day in a seller's market. 2nd - the amount of interest that I will be paying over the life of a 30 year note. I'm probably missing a tax thing here, but aren't we going to be paying back several times the cost of the house on a 30 year note? I just want a full understanding prior to moving forward. Thanks

@gail5095 4 года назад

Why do you care how much the mortgage is or the interest on it for that matter since your tenants are paying all of it? When you BRRRR (properly) you don't pay anything for the house, the house pays you! Not to mention there's mortgage pay down and forced appreciation as well. You can't really lose.

@MomentsAndInspirations 5 лет назад

I always hear that you are allowed to only pay a lump sum payment of 10% to your mortgage per year. How would I be able to pay the initial mortgage amount of $160k? Thank you for the video! I'm a young civil/structural engineer and looking to use my savings somewhere, thanks for this!

@dillonguppta622 4 года назад

Did this ever get clarified for you?

@Dabaobao23 4 года назад

please share where you can get cash out 80% on a rental, and also whats the typical time line for this method?

@Vnillagodzilla 4 года назад

What happens when the market tanks, and the property value drops to its original level and you’ve refinanced up to the higher price?

@MikeRosehart 4 года назад

Dunnagan Motta you have $1000/month cash flow positive still... You wait for the property to recover. 10 years from now I guarantee the real estate prices are higher than they are now. 2 years from now they could be down, but we don’t play for appreciation - I play for cash flow from rental income. Rents remain stable, even in recessions

@watchfalcon122 4 года назад

Mike Rosehart unless rents don’t remain stable with high unemployment 😐

@chillin374 4 года назад

Good explanation. What about cash flow? I'm guessing it goes down substantially since now you went from a mortgage of 160k to 260k, correct?

@MikeRosehart 4 года назад

Danny Alvarez yes cashflow is reduced, but still positive cashflow and now you can pull out 100,000 to buy 2 more properties - so the Net cashflow is overall higher.