Found a deal but...

[Chris Seveney]

Question for the BP community. I am currently completing a BRRRR which we paid with cash (acquisition and renovation). This has depleted our cash at this time for any new projects. I did find a bank owned property that would make a great BRRRR but all my cash is tied up in my other property. Any creative ideas / ways to go after this bank owned property? The property is also a condo and would not qualify for Fannie Mae type loan because it is a rehab. Acquisition price is around $200k, 60k renovation and ARV of $325k. Washington DC - Maryland - northern Virginia area is where property is located Curious if a private lender would lend and use my other property as leverage ? Thanks

[Justin P.]

@Chris Seveney

Sounds like you're going to need to put both properties as collateral for this.

Current Property ARV = $135k
Loan @ 65% LTV = $88k

New Property ARV = $325k
Loan @ 65% LTV = $211k

This would get you the $260k you need plus some. However, in this scenario I probably wouldn't lend more than the $260 needed.

Neither property is going to do it on its own. You will also need to be able to refinance both properties in order to cash out both loans which makes it riskier for the lender.

Does that make sense?