How the heck do we finance this?

[Charlotte Adams]

Hey smart money people and people with way more experience than us.   I am wondering if anyone wants to give us some pointers. 

   We live in Ontario,  We own one home with at least $300,000 equity, and a second duplex of which we currently have estimated $135,000 equity.   Our income is only $60,000 combined.   Rental income (we rent half the house we live in as well) is $3150 monthly and our fixed expenses for both houses total around $4000 monthly.   

What we would like to do is start flipping houses as we have learned through our last house that this is something we enjoy doing and are actually pretty good at. We wanted to do a modification of the BRRRR strategy, where we buy, flip, rent, refinance, sell after a year and be flipping another while the rental term is being completed. We would also be wanting to purchase multi family units as our long term/retirement investments and using the money from sales to cover living expenses etc. ( I hope I explained that clearly enough)

   We have also tossed around the idea of living in the property we are rehabbing and renting our side of our home (which we want to keep) to help with the financials. (could rent for $1700 easy).   We could happily be a young gypsy family for the next few years until children are in school. 

   The issue I have is getting going with our first approval, we are thinking of refinancing the duplex to get our available equity (up to 80% gives us $74k) but dings our approval value.   We DID just have someone I have been working on the side for, approached me after hearing of our real estate investment drive and said he too wants to invest but financially.... is this the answer to our prayers?   He will invest between $50,000 and $100,000.  My question is.... How does this work? We have only ever done real estate purchases through traditional mortgages.  How does one do a house flip, potentially selling the property in 6 months using an investors money?  What is the going rate of interest? How is that charged?  This is completely new for me. 

   We are also open to Any suggestions anyone may have as to financing this venture? I am sure once we make the money on the first few flips we wont have any issues with approvals but right now this has been a month long battle. 

    This is my second post and I was just over whelmed at the knowledge and advice we were given.  I am so thankful for any answers and suggestions.