brrr newbie

[Brett Hogan]

I have being some homework on the brrr strategy. it would be awesome to read through someones steps who took this rout for a multi-family unit.  I have found three duplexes (on the same street next to each other) listed for 45k each within 10 miles of my house. I'm looking for some next step advice so to speak. Thank you. 

[William Hochstedler]

Hi @Brett Hogan

The first step is figuring out how you can force equity meaning what can you do to the property to increase value.  The reason that this strategy works is that you can refi on much more favorable terms than you may be able to get on purchase if your refi value is substantially higher than the purchase price.  The two most common ways of doing this are rehabbing and raising rents.

The next step is figuring out your short term financing of the original purchase.  The options are your own cash, friends-and-family loans, hard money, seller financing.

In general, multi-family properties are tough for forcing equity.  Are there similar duplexes in the area that are nice and well managed for $70-100K?