Using a BRRRR strategy for family member

[William Lee]

Hi BP,

I am an investor based out of Richmond, VA. I have a small portfolio of single family rentals locally. I have used the BRRRR method on my last two acquisitions with my first two using conventional 25% down payments. My latest property is in the final stages of renovation and then it will move to the refinance phase (utilizing a HELOC on my primary residence).

I am looking to expand my portfolio. My next acquisition may be a rental property in New Hampshire for my in-laws (I acquire the property and fix it up, they pay the mortgage and maintenance on it as long as they live in it...which should be for the remainder of their lives). I have established a fix and flip line of credit through Finance of America. I wanted to use that line to purchase and rehab a property for the in-laws before putting it under long-term financing but come to find out that there is a term in the agreement that prevents the line to be used on a property for family members. I am now looking to other sources of funds for this possible deal. I am looking at a property that is listed around $150k and will need $20k to fix up. I anticipate a $200k ARV. I am hoping to get the property for less than asking due to its condition. But, I wanted to think through funding sources before going in with an offer. Does anyone have a good solution that would work for this kind of deal involving a family member? Do hard money lenders have similar restrictions?

I do understand this won't be the most profitable deal. But, I am hoping to earn a different kind of treasure with this property.

Thanks for your help!

Mac