Unlocking Trapped BRRRR Equity with a 2nd Mortgage

Written By Jey Arul

The Challenge: The Seasoning Period Trap A high-volume real estate investor in Edmonton had just finished a beautiful BRRRR (Buy, Rehab, Rent, Refinance, Repeat) project. The property was fully tenanted and cash-flowing perfectly.

The problem? Their traditional bank required a strict 6-month "seasoning period" (rental history) before they would allow a cash-out refinance on the newly appraised value. The investor had $120,000 of their own capital trapped in the property, and they had just found their next flip across town. They needed liquidity immediately, not in six months.

The AJS Solution: The Strategic 2nd Mortgage Instead of forcing the investor to break their excellent first mortgage rate or sit on their hands for half a year, AJS Capital stepped in. We placed a fast, interest-only 2nd mortgage behind the primary lender. We appraised the newly renovated value and advanced funds up to a 75% Combined Loan-to-Value (CLTV).

The Result: Continuous Scaling

  • Time to Fund: 12 Days

  • Loan Structure: 2nd Mortgage / Equity Take-Out at 75% CLTV

  • Outcome: The investor accessed $85,000 in liquid cash in under two weeks, using it to close on their next flip. Once the 6-month seasoning period ended on the rental, the bank refinanced the whole property, paying off the AJS 2nd mortgage. The investor scaled their portfolio without missing a beat.

Have equity trapped in a rental property? Don't let your next deal slip away. Submit your deal today to unlock your capital.

Jey Arul

Most people who advise on buying and selling businesses have never actually done it themselves.

I have — on both sides of the table.

Over the past 20+ years, I’ve worked as a Commercial Banker, Investment Banker, and M&A Advisor, and I’ve personally advised on and closed 90+ small and mid-sized business sales and acquisitions across Alberta.

I’ve structured deals.

I’ve sourced capital.

I’ve negotiated with buyers, sellers, lenders, and investors.

And yes — I’ve also built, bought and sold my own businesses.

That last part changes how you see everything.

It means I don’t just understand deals academically or from a fee-based advisory lens. I understand:

- The emotional side of letting go

- The fear of “Did I time this right?”

- The risk of picking the wrong buyer

- And the very real difference between a paper valuation and a closed transaction

My career has lived at the intersection of:

- Commercial banking & credit structuring

- Private lending & capital stacks

- M&A and business sales

- Owner-operated, main street and lower mid-market businesses

I’ve helped owners:

- Raise growth capital

- Buy competitors

- Refinance and de-risk

- And exit businesses they spent decades building

Today, through AJS Capital, I work with business owners who are thinking about selling, partnering, or buying — and with advisors and brokers who want to level up into real commercial and M&A work, not just talk about it.

I’m originally from Singapore and have been based in Edmonton for over 30 years. I bring a global perspective with very local, very practical execution.

If you’re a business owner thinking about an exit, a buyer looking for the right deal, or a broker who wants to step into serious commercial and M&A transactions — let’s connect.

No hype. No fluff. Just real deals, done properly.

https://www.ajscapital.com
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The 5-Day Distressed Acquisition