BRRRR Method and Over-leverage Question

[Duarte Silva]

Hi Everyone! I'm a 21 year old college student and have been increasingly more invested in learning about real estate and building wealth. I have bought David Greene's BRRRR book and I'm thoroughly enjoying it so far.

One thing I still can't wrap my mind about is the potential to over-leverage and take on too much debt. From what I've read both in the book and online it makes it seem that the risk to BRRRR is low and that continuous refinancing brings a huge upside but I haven't really seen the downsides. What if your renters stop paying rent or the market goes on a downturn and you're stuck with debt on 10+ properties that you can't pay.

Especially for someone like myself who is about to enter the job market and doesn’t have that much in savings for one property I can’t see myself refinancing 2-3 in a year with the risk of 1. Not finding people to rent 2. Renters stop paying 3. Some other downturn. 

I would appreciate any advice and I apologise in advance if I haven’t understood the topic fully as I said I’m in the beginning of this journey and want to learn as much as possible.