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_
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!
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 :)
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.
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.
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 )
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!
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.
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.
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?
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.
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!
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.
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
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.
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?
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.
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?
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.
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?
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?
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 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.
@@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.
@@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.
@@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.
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 UA-cam search or recommended. 100% like ratio on over 120 likes is decent in the first day though.
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 🙌
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 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! 🙌🙌
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 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
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.
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.
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.
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..
Mike I just found your channel and am glued! However how the heck am I gonna brrrr in my area, just outside Vancouver BC. I’m in a 5 bedroom house with a basement suite and it’s 1 million. If I go another 45 minutes out from Vancouver I could buy mine for 700k. What do I do? I watch all these videos but nothing compares to what my area is :(
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) . . .
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.
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.
@@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.
@@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.
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 👍🏼👍🏼
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.
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 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?
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).
hi, just want to check one thing. Once we refinance and payout our previous loan & do the self - pay it is great that we paid the loans and pulled out all our money back, but still we have the refinance money to pay back to the bank and with interest right? How do you manage that?
You answer the other question. But this is very important. Because I found strange a bank give money for a remorgage when you don't use that money to do any work in the property. Or you say to the bank that you are going to use the money on the property and on end you don't use it? If so, how come the bank take the same explanation when do over and over again?
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!
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.
I’ve watched a lot of videos on BRRRR and I have yet to find an answer to a question that I have; am I to assume that you take the money from the refinance to pay yourself back for the vacancy of the apartments until you find a tenant?
Can I do a cash out refinance 6 months after I renovate and rent my property? How long should I wait to do a cash out refinance? I plan to do the brrrr method with a million dollar rental property. I need to pay private lenders stat.
I have a couple of rental property now your video showed me a new strategy. Is it possible to set something up were can chat about my specific numbers?
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)
When you refinance and take cash out what rate do you for morgage? Is it worse morgage rate if you are taking money out versus getting new morgage for buying another home?
Mike Rosehart well in most European countries there is a big difference if you are getting a loan for real estate or just getting a general loan. Usually 3.75% vs 6-7%
Valent Turkovic I meant getting a mortgage on a property - you can use those funds to buy anything. Unsecured loans are higher interest here as well. I was talking secured.
Does it make sense to refi a primary residence to get some of the equity out to put into a rental investment? I sunk a lot of my proceeds from my sale in California on my new Texas home and am wishing I had invested most of that instead. I'm wondering if it makes sense to do this now that mort rates are dropping vs pure saving up for the 20% on the first rental investment.
W. Edward Beck I think it definitely makes sense to refinance the capital out and put it to work at a higher rate than the borrowing cost. If you can refinance it out at like 3-4.5%, and put it to work in property at 10%+ you stand to make a lot of money!
I have a question Mike, I'm looking at a potential property that I'm considering on doing a BRRRR. Here are the numbers: ARV - $134,000, Purchase - $64,000, Rehab - $16,000, PML taking care of closing costs, rehab and interest at 13%. PML Loan Amount - $83,000. My question is the refinance part, let's say I have a small Credit Union here in Texas. And they appraise the home at $129,000 do I have to accept the whole amount that the appraiser is telling the lender? The reason why I ask I would much rather just take a lessor amount of $110,000 so my loan with the bank is smaller. Hopefully that makes sense?
Mike Rosehart that’s a good point. I was just thinking that it would make more sense to have a lower loan since the payment for the mortgage would be cheaper which would than result to more cash flow?
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?
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🙏
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.
Hy Mike!I just have one question: In your example,you say you have a first mortgage of 160k,and you subtracted that from the 260k of your refi,so my question is,if you put 20% down(40k),you have a 160k mortgage,but that is just principal,right?I mean,I didn't see the interest in your calculations!I mean,you have to pay the bank the 160k mortgage plus interest,so if your refi gives you a check for 260k,you have to pay the mortgage plus interest! I woul love if you could provide some insight on this matter!Thank you Love your content!Cheers from Spain
Ionut Mihai Lapadat your monthly interest costs are part of your carrying costs - the tenants pay for that with their rent. We aren’t flipping, we have rental income to cover operating expenses, even with the new mortgage at 260k, the property should be cashflow positive still.
A,ok,so that means that the first bank from which i get the first mortgage doesn't collect the interest over 160k principal?or does the refi part pay that to them!Sorry,I'm a newbie in this,plus,live in Spain,I don't know how to apply BRRRR here,or even if it works!Thank you
awesome vid man very simple to understand cool bro
Razor Morris thanks 🙏
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_
@@MikeRosehart hi l have qst is when refenince does the bank want the money back when You refinance
@@MikeRosehart how do you find properties less than market value to get started?
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!
How many now?
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 :)
#pulloutmethod #cashpullout
Who can tell me at what time in the video I drop the pullout method joke?
2:24 lol
02:24
Jacob L lol
Go T.o you’re watching ;)
This has to be the BEST example of the BRRRR!
No one has ever explained this the way you did for me today. Thank you very much for taking the time to do this
This video was very good man , I just bought my first rental property. Now this video just pushed me forward 🙏🏾✌🏾
Let’s go wooo.
Great way to break it down your videos are so helpful I want to try this I just got my fixer upper
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 .
Probably the best explanation of Brrrr I’ve seen. Thanks
Very detailed video with an easy understanding of the BRRRR Mike! Great video as always!
Thanks Tommy!
The pull out method 😅🤣😂🤣😅 that's a good one!
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.
Thank you for a detailed description in something that I was curious about. Subscribed.
👌
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.
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 )
inferno46n2 will do! it’s definitely coming!
inferno46n2 it’s do-able in any market.
@@MikeRosehart I look forward to it. Thank you!
inferno46n2 ❤️
That’s exactly what I’m talking about how to find them.
great explanation but I assume you need the 200-250k to invest on hand right?
More is better, but less is possible. Depending on prices in your area.
#pulloutmethod #cashpullout
Who can tell me at what time in the video I drop the pullout method joke?
2:23 - 2:26 minute
I wouldn’t recommend that method lol 😂
When you refi and buy another house which one do you consider your house and which one your secondary loan
Sounds good I still flip the property and do it again and again
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!
parade8 try another bank.
parade8 keep at it, it’s a tough grind
I've watched a ton of videos on this. you made it real simple to understand thanks!
SuperBlakk Truth aw thanks 😊
Great video Mike! Love the new whiteboard. Looking forward to doing some other BRRRR's in the near future!
Sounds good! Me too! THanks!!
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.
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.
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?
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.
don trinh the strategies definitely work on student rentals. I’ve brrrr’d lots of them
I can't wait for next videos in this series about BRRRR! Great job as usual!!!
Thanks 🙏
That was explained well, I have renovated my home by myself and still working on it
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!
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.
Wow this actually made so much sense I love it
Thanks! It’s my favourite method. It’s actually indexing now too after I took it down and reuploaded
Should look into BiggerPockets too if you want to know more about the strategy
What do you renovate to bring the home value up ??? And whats the ideal amount to spend doing the renovation
This is so informative. I am a beginner and would love to hear the tips. Thanks for making this video!
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
Thanks I was so confused and your video made it so easy to understand 😊
Talha 👌 thanks
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.
true, how are banks lending you multiple mortgages/ refinances? really confused here
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
Hard money lenders don't care about income
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?
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.
Fabian Martinez yes it (the reno) comes out of your pocket but you get the money back (reno and downpayment) on the refinance.
Thank you for a fast reply, liked and subscribed, have a good day!!
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?
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 :)
What do you use to manage/track the finances of this?
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.
Erwin 😊
Thanks for the video. I have to admit your two jokes were funny!
haha - thanks!!
You are a good man.👍great videos
🙏
Thanks for explaining this!
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?
Stacy Moreau sometimes you can get them waved.
Stacy Moreau you can go elsewhere or refi with the same institution, often they’ll waive the fees.
great video mike. i just sent it to my investors as a guide to investing with me. really good.
Dan Desveaux love it! Happy
To help Dan! :)
Dan Desveaux this comment made my day
Mike, should I stick to buying duplex homes instead on single family homes? For higher cashflow?
PiqueGustavo1986 it depends. That’s definitely one approach. More cashflow can be preferred, but more headaches come with the cashflow.
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?
these are all very good questions that i need answers immediately
Awesome job Mike. Keep up the great videos!
Steven Cacace thanks 🙏
How do you find those buys? Strategies to find a Brrrable property? Thanks so much.
All sources on market and off
@@MikeRosehart Merci!
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.
Good thing you bought for cashflow - the BRRRR can’t fail - worst case is you have $1,000/month in cashflow.
@@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.
@@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.
@@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.
@@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.
I see your Videos are blowing up! Really well explained and super thorough.
Literally blew my portfolio through BRRRRing.
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 UA-cam search or recommended. 100% like ratio on over 120 likes is decent in the first day though.
Austin FI Yeh you are a young Real Estate investors GOAT. 0-10 units super fast! :)
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 🙌
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!
Initially funded by savings or private money, and you create the equity in the deal by adding value to it.
@@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! 🙌🙌
Absolute gold! Loved the way you explained it mate :)
Thanks :)
Hello
Did the bank ask you for collateral asset like bank savings or others ?
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?
I like Southwestern Ontario, mostly London
Glad to have blown your mind re tax free :)
That’s the best part. It’s basically a 1031 for Canada
@@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
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.
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.
Lol they way he say “tonnnn of money” 🤣
I have one question, how much time would you wait before refinancing it?
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.
Haha -I buy anything that cash-flows or is undervalued. sounds like a smart guy :) Full Cash-Out Refinance is basically a BRRRR
Amazing! How would you keep getting approved for loans though?
Use o% business cards
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..
So great we both share a passion for this 💰
❤️
Mike I just found your channel and am glued! However how the heck am I gonna brrrr in my area, just outside Vancouver BC. I’m in a 5 bedroom house with a basement suite and it’s 1 million. If I go another 45 minutes out from Vancouver I could buy mine for 700k. What do I do? I watch all these videos but nothing compares to what my area is :(
It’s definitely a bigger scale in a higher cost of living area.
Maybe try preconstruction with a low deposit?
@@MikeRosehart funny you said that I’m in one already!!!
is there a seasoning period for when you can refi?
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) . . .
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.
What market are you in?
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.
@@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.
@@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.
Great video Mike! appreciate the content. Was the type of mortgage in this scenario a purchase plus improvements mortgage?
Duncan Pratt in this scenario it wasn’t. PPI mortgages can’t be full BRRRRs, only partials usually.
Duncan Pratt thanks 🙏
@@MikeRosehart so the mortgage was just a standard mortgage from a conventional lender?
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 👍🏼👍🏼
To pull your money out at a low interest rate.
so in order for this to work you need renters for the properties correct?
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?
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.
Best Video on BRRRR compare to the others. Thank you... Pull out game baby! lol
William Trigoso aww thanks 😊
🤣
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!
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.
@@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?
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).
Is london ontario is great for investment compare to the gta ontario
hi, just want to check one thing. Once we refinance and payout our previous loan & do the self - pay it is great that we paid the loans and pulled out all our money back, but still we have the refinance money to pay back to the bank and with interest right? How do you manage that?
So you did a morgage over a morgage. How the bank give you money? What you told the bank the money was for?
You answer the other question. But this is very important. Because I found strange a bank give money for a remorgage when you don't use that money to do any work in the property. Or you say to the bank that you are going to use the money on the property and on end you don't use it? If so, how come the bank take the same explanation when do over and over again?
love the video! very simple. I want to start doing this.
Camilo Hernandez try it out :) tax free eligible dividends
@@MikeRosehart I am looking to start this year. I am going to get pre approval first from a broker and to start looking
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!
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.
I love the pull out method ;) haha
Do you have to rehab before you do a cash out refi?
I’ve watched a lot of videos on BRRRR and I have yet to find an answer to a question that I have; am I to assume that you take the money from the refinance to pay yourself back for the vacancy of the apartments until you find a tenant?
Yup, holding costs are built into the renovation budget
@@MikeRosehart thanks a lot for answering my question. Very much appreciated
I'd love to read a book by you on this and all your combined strategies.
trinik95 if I have the time I’ll write some books 😂
Can I do a cash out refinance 6 months after I renovate and rent my property? How long should I wait to do a cash out refinance? I plan to do the brrrr method with a million dollar rental property. I need to pay private lenders stat.
Goddess Zoei yes, the short answer is you could.
Refinancing in an LLC or in your name than put it in an LLC?
Great channel, awesome information Mike. Thank you
Ricardo Leon welcome to my channel! And thanks ! 🙏
Lots more where this came from :)
please share where you can get cash out 80% on a rental, and also whats the typical time line for this method?
I have a couple of rental property now your video showed me a new strategy. Is it possible to set something up were can chat about my specific numbers?
Patrick Clopton I occasionally do paid coaching calls - like very occasionally - one per year? 😂
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)
Hi what markets you working in canada?
When you refinance and take cash out what rate do you for morgage? Is it worse morgage rate if you are taking money out versus getting new morgage for buying another home?
Valent Turkovic no, identical
Mike Rosehart well in most European countries there is a big difference if you are getting a loan for real estate or just getting a general loan. Usually 3.75% vs 6-7%
Valent Turkovic I meant getting a mortgage on a property - you can use those funds to buy anything.
Unsecured loans are higher interest here as well. I was talking secured.
Mike Rosehart thanks for clarification
Does it make sense to refi a primary residence to get some of the equity out to put into a rental investment? I sunk a lot of my proceeds from my sale in California on my new Texas home and am wishing I had invested most of that instead. I'm wondering if it makes sense to do this now that mort rates are dropping vs pure saving up for the 20% on the first rental investment.
W. Edward Beck I think it definitely makes sense to refinance the capital out and put it to work at a higher rate than the borrowing cost.
If you can refinance it out at like 3-4.5%, and put it to work in property at 10%+ you stand to make a lot of money!
Great video. You talked about being a private lender in another video. How can we do that?
I have a question Mike, I'm looking at a potential property that I'm considering on doing a BRRRR. Here are the numbers: ARV - $134,000, Purchase - $64,000, Rehab - $16,000, PML taking care of closing costs, rehab and interest at 13%. PML Loan Amount - $83,000. My question is the refinance part, let's say I have a small Credit Union here in Texas. And they appraise the home at $129,000 do I have to accept the whole amount that the appraiser is telling the lender? The reason why I ask I would much rather just take a lessor amount of $110,000 so my loan with the bank is smaller. Hopefully that makes sense?
Rickey Miller Jr I don’t see why you wouldn’t want more debt if the interest rate is below 4-5%.
Rickey Miller Jr and no you don’t have to accept anymore Debt than you’re comfortable with
Mike Rosehart that’s a good point. I was just thinking that it would make more sense to have a lower loan since the payment for the mortgage would be cheaper which would than result to more cash flow?
How did you get you initial down payment?
Great video Mike!
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?
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🙏
Don't you have to pay on the mortgage monthly once you refinance it?
Hi Mike! Thanks for the video. Quick question how do you count the interest payments made to the HML during rehab in your calculations?
JR carrying costs
Hey Mike, does this strategy take into account Bank Interest?
David Kiruhi yes - carrying costs factored into reno & into cashflow
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.
Join my Deal email list :)
Lol
I’ve got 2 right now that are partial BRRRRs near the college.
Thanks Jake!
@@MikeRosehart how do I join your deal email list?
@@MikeRosehart Great I'd love to, how do I join your email? Thanks!
Jake email with your name, email and number to roshartproperties@gmail.com
Hy Mike!I just have one question:
In your example,you say you have a first mortgage of 160k,and you subtracted that from the 260k of your refi,so my question is,if you put 20% down(40k),you have a 160k mortgage,but that is just principal,right?I mean,I didn't see the interest in your calculations!I mean,you have to pay the bank the 160k mortgage plus interest,so if your refi gives you a check for 260k,you have to pay the mortgage plus interest!
I woul love if you could provide some insight on this matter!Thank you
Love your content!Cheers from Spain
Ionut Mihai Lapadat your monthly interest costs are part of your carrying costs - the tenants pay for that with their rent. We aren’t flipping, we have rental income to cover operating expenses, even with the new mortgage at 260k, the property should be cashflow positive still.
Ionut Mihai Lapadat 🙏
A,ok,so that means that the first bank from which i get the first mortgage doesn't collect the interest over 160k principal?or does the refi part pay that to them!Sorry,I'm a newbie in this,plus,live in Spain,I don't know how to apply BRRRR here,or even if it works!Thank you
Thank you for your example of the BRRRR strategy. Btw you’re good looking too. 😉
What about in commercial real estate? I hear lots of big guys refinance large commercial properties