what should I do: BRRR or try to use Business loans

[William Goodlett]

Greatings

     I have been listening to Bigger pockets, Grant cordone, "Koncrete", Max Maxwell, local investors, Morris invest, Graham Stephen....etc. What I have found out is that there are different ways of investing. I have come to the end of buying rentals with all cash. I have 4 with another one coming. I'm getting tired of being stressed about using up all of my money or tying up all of my ends with the houses after I buy them. 

I created a LLC and created a DBA for the counties that I have my rentals in. I tried to get a hard-money loans but they messed up my credit and still did not approve me (just created a ton of credit cards and opened them for me). I tried to get a loan from a bank. The first time around I get , "we don't do single family homes, or we only give out loans for income properties during certain times of the year". Finally I get a bank that would try to do business with me. I was asked home long I had a E.I.N and to produce a schedule C. I did not have one yet and I need 3 years worth. They tried to talk me into do a refinance of my primary home. Then they asked me to one for the property that was the most expensive. I told them no for those two and that I would for the lease expensive one. The price would cover buying and fixing the home that I was looking to buy. They would not do it. I'm assuming because they wanted more money.

Should I use the BRRR strategy for the house that I make $680 a month and pay $368 total expenses. The home that I'm now looking to buy and rent out would be around $28k-$35k and should only cost me 5-6k if I'm able to fix it myself. I just don't like to lose leverage.

Is the BRRR a great , safe, idea or is there another method I can use?

[Marcus Auerbach]

@William Goodlett this is much easier than you think. Fixing up houses to rent them out has been a great and sound strategy long before it has been called BRRRR. It allows you to buy properties for less, because of their condition, improve their value, attract better tenants and create equity in the process. And it's also good for neighborhoods.

As far as the financing part I am afraid you went way overboard with your LLCs and DBAs. Banks will lend you money on properties, but they want your full liability, not your limited liability to get their money back. Brandon Turner has made a great video about LLC or not, look it up. Bottom line, legal entities come in when your net worth becomes significant enough to create firewalls between individual pieces.

Avoid large banks and google local banks and credit unions; with a decent credit score you will not have a problem to get a loan in your name on a cashflowing property.