First deal! Funding an off-market BRRRR

[Dalton W.]

Hello Bigger Pockets! Long time lurking fan of the podcast, youtube content and more recently forums, finally diving into my first deal.

I’ve been building a business plan and saving my money along side my business partner with plans to launch our business in 1H21. However, I’ve recently come across an off-market property that might be too good to pass up, causing me to have to look creatively for financing options

Without going too into the weeds on the deal specifics, I’m hoping to source some ideas for how to fund this deal.

This is a three family house in a desirable New England suburb that needs fairly extensive work. The 1920s built property has two highly out dated units that will need new wiring, possibly new plumbing, and cosmetic work, while the third unit is completely gutted to the studs and needs a bottoms-up finishing. There are also two balconies and a porch that need complete rebuilding, as well as all new utilities, etc. sufficive to say, I’m anticipating a ballpark of $100k in rehab. I’ll be PMing the whole rehab and will opt to do much if the demo and finishing work myself, contracting out only the major permitted work. I currently have the money for a 15% downpayment on the expected acquisition price.

Being off-market I’m wondering the following:

1. If I’m able to secure seller financing, am I excluded from cash-out refi’ing post-reno & rent?

2. If I’m able to secure seller financing, what would be my best bet for financing rehab? Should I turn to credit cards or a personal loan?

3. If I cannot convince the seller to hold a private mortgage, am i excluded from FHA financing on this deal? Can I FHA an off-market property valued based on comps and DCF without an appraisal/agent? Also, because 1/3 of the property is uninhabitable, does this exclude me from eligibility?

4. If I cannot convince the seller to hold a private mortgage and instead turn to hard money, what should I expect as far as rehab financing? I recognize that every lender is unique, however, wondering if anyone has any tips or experience funding a 90/10 or 85/15 LTC + rehab...

Finally, on the rehab itself: generally speaking should I plan on finishing unit-by-unit and renting one at a time over a slower period? Or plan to do the total rehab at once, rent and then refi out? I realize the holding costs will be greater with a longer rehab period, but I assume it will be hard to rent up units while conducting major rehab work, while also reducing the efficiency of contractors ability to complete jobs in fell swoops...

Thank you all in advance!