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Kick off the new decade strong by growing and updating your rental portfolio in 2020. Plus, we have the perfect tool to help you: cash-out refinances. A cash-out refinance is when you replace an existing mortgage with a new loan for a higher amount, and the difference in cash is yours, or when you obtain new financing on a property that is currently not pledged on a loan. Here is how cash-out refinancing can be a magic weapon for investors in 2020.
Access to capital can help investors:
2020 is a great year to update your rental properties before 100% bonus depreciation expires in 2022. Let's back up. When the Tax Cuts and Jobs Act (TCJA) was passed in 2017, the cap on bonus depreciation was changed from 50% to 100%. For landlords, this means improvements to your rentals other than anything on the physical structure can be deducted up to 100% such as fences, landscaping, swimming pools, outdoor lighting, sprinkler systems, etc. Act in 2020 to beat the upcoming deadline. Plus, what better way to finance these updates than a cash-out refinance?