Newbie . Brrrr . Specifically the R-Refinance

[Kathryn Romine]

This is my first Discussion.

I have been up digging the the archives of the BRRRR for a few weeks now and found so many discussions and the truth if the matter is , I'm just stuck as to which way I should move forward!

Also a shout out to Brandon Turner, Andrew Syrios (Personal Fav), Jennifer Beadles and Candice Elliot. 

Here is my situation .

My husband and I own / mortgage 3 properties,  we have never done a Brrrr and I wanted to get started.

There is a house I have been eyeing that I want to send an offer to the owner on. The current problem is which house do I use as my start for the brrrr how do I break the numbers down which route do I go?

(When I say "I" I really mean "we" because I consider my husband a silent partner until I need him to do something because he runs his own business, and until I have numbers to show him with research he doesn't have time , which is why I want to get started on the BRRRR because I want him to see how much better and more rewarding it is to have our money work for us not the other way around)

Home #1 is an FHA at 3.75% , Rental. Our first house ,we lived in for 4 years. Amount owing on 300,000 loan is 260,000 , current Value $475,000. This house needs a new roof in 2-5 yrs costing $18,000+ . It will need some updating as well to keep up with the rental market, ( near a full kitchen remodel minus appliances and floor, bathroom countertops, and cupboards and some light fixtures are dated ,it was partially updated in 2010. So maybe another $15,000. Also a minor sink hole in driveway slab that is turning into a little pond when it rains. That's gonna be a chunk of money. It's a great house in a wonderful HOA neighborhood and I think it might be best to sit on this one for another year before doing a HELOC on it, or correct me if I am wrong.

House #2 Private Loan /Seller is holding Loan. 6%. Rental . 2 homes on one Lot. Owe 102,000 on 107,000 loan. Current value $230,000. One house will need new siding and roof within 5 years. Simple design 900 sqft. I'd love to bring back the origional beauty of these  War Era houses with modern touches, obviously this won't add value to the homes though.  These houses rent very quickly and bring in 50% income and are in a good market zone.  I am thinking this property would be  the pick for the BrrRR .. heavy on the Refy and Repeat since this one is already done, just don't know which route to go, refinance,loan, or line of credit?6

Our # 3 Property is a huge ball of mess that I will be talking about in a later discussion. 

We are not new to building or updating. But the place I'm looking at might be a near Gut down to some studs, which we are new too. The realistic idea of how long it would take pending permits or any unforeseen problems such as mold, water erosion or foundation issues might come up . If I can get it for below Land Value this would be a great Hold for our "portfolio"!

Here are some rough numbers. 

House current County Assessor Value $124. Market Estimate $240.

No one in there right mind would see 240 in current condition so I think this is way off, its more of an ARV number. Offer of Land Value and rehab/gut bringing total cost to $100,000.

 I want this property,  I just need to figure out what makes sense.

Suggestions?