BRRRR Newbie Questions

[Alex Huang]

I understand the over-arching principles behind the BRRRR strategy, but I have some questions that i was hoping some experts could answer below.

I've purchased my first property in cash. I expect to be all-in at right around $55-$60k on the property and for the appraised value to be in the neighborhood of $85k-$90k.

Would the proper steps be:

1. Rent out the property. Get a tenant in there.

2. Once a tenant is in, go and get refinancing.

3. Have the house re-appraised (how do you do this, do you just order an appraisal?), and expect to get between 70-80% of the appraised value in cash out of the house.

4. Use that capital to find a new property

Am I missing anything here?

[Andrew Syrios]

Your steps are right, but the appraisal is ordered by the bank after they approve you (you'll be paying for it, of course). At that point (if everything goes right), you will either get all of the money you put in back out to buy another house with, or pay off the private loan you had on the property so you can put it on a next.