I am just trying to educate myself by going thru the refm courses. In the attached image, what does "excess proceeds to equity from refinancing" mean ? I know that it derives from the difference between $356,250 and $315,000, but what does it mean? why is it tax deferred "play money"?? The videos on refm don't really explain this.
Thank you for any kind of help.
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I think I got it! i dont know how to remove a post!
Actually, I figured out the first question, but still no clue for the second question. The video refers to the $30,563 as "tax deferred, non recourse play money". Can anybody help me what that means?
When you cash out on a refinance the excess equity being pulled out is not considered "income", thus not taxable. I assume "play money" means it can be used to put towards another investment, which is not atypical.
Does that make sense?
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