Best way to save up for BRRR

[Shion Queen]

I’ve been beefing up on my education. I have about $25k. My goal is to reach my magic number of passive income in 6 years. Any suggestions on how to jump in?

Should I flip and save more cash for a larger down payment to BRRR in the SoCal market?

Should I try to immediately BRRR in a different/cheaper market (I have no contacts there).

I think I want to use a HML or Investment Lender as I currently have a mortgage on my primary residence, great credit, but not sure I would qualify for a conventional loan.

Do I find the deal first or get pre-approved with a HML or Investment Lender?

Thanks. Sorry I slammed my post with multiple questions.

[Michael Glist]

Hey @Shion Queen,

I would say if you are looking for passive income that you should do a flip and a BRRR each time this will allow you to start acquiring property for your portfolio while giving you cash to get into multi family and apartments.

I would say stick to somewhere near you no more then 2 hours away this way if there is an issue with the rehab and/or a tenant you have the ability to get to the property in a timely manner and avoid potentially bigger problems.

Using a HML is a great idea especially with some lenders that can give you the initial acquisition loan as well as funds for the rehab and then you can refinance it. The nice thing is that a lot of HMLs offer short term rental loans this will be a loan for 2-3 years giving you the history that conventional lenders like to see when approving you and being able to use the rental payments to offset the mortgage payments. This then allows you to get them hold them for 2-3 year then refinance them to a traditional mortgage with no issues.

I would say get approved first the last thing you want to do is look at  20+ properties find one you love spend time negotiating a deal and then find out that you do not qualify for one reason or another. 

This is just my opinion so take what you will from it. If you have any additional questions feel free to reach out to me.