Underwrite the exit before the entry
BRRRR fails at the refinance, not the purchase. Before you sign on a bridge or hard money note, price the permanent loan against a conservative after-repair value and a conservative market rent.
- Model the DSCR refinance at today's rate, not a hoped-for rate
- Use market rent support, not the highest comparable on the street
- Assume the appraiser lands under your ARV estimate
Seasoning and the value you can use
Seasoning rules decide whether the refinance uses your purchase price or the new appraised value. That single distinction can be the difference between recovering your rehab capital and leaving it in the deal.
Keeping the rehab loan clean
Draw schedules, permits, and contractor invoices become part of the refinance file. Keeping them organized during construction shortens the permanent loan by weeks.
Frequently asked questions
- How soon can I refinance out of a bridge loan?
- It depends on the permanent program's seasoning requirement and whether the property is leased. Plan the timeline before closing the bridge.
- Does the property need to be rented to refinance?
- A signed lease strengthens the file. Some programs allow market rent support when the unit is vacant but rent-ready.
Continue your research
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