1st investment BRRRR - Hard Money

[Will Jones]

I'm looking to get in a call or zoom with someone who has done a BRRRR with hard money lending. I want a deep dive into all the parts. Please inbox me.

[Will Jones]

Quote from @Jesse LeBlanc:

Sounds like Networth or New Western, if so @Will Jones be ready to overpay and they'll pressure you to use one of their hard money lenders or your own if you have one. Then they'll make you double close and they'll make you pay for their closing costs vs simply assigning you the deal. They'll also force you to put around 5k EMD down and won't care at all if your hard money lender doesn't come through, they'll keep your EMD and have no problem burning a relationship over $.

You need to make sure that you ARE NOT pressured into buying!! Make sure that you know your rehab costs ahead of time, make sure you know all of your lender costs and make sure you have ARV based off of YOUR rehab finishes and DO NOT let the "broker" (wholesaler) tell you what the ARV is as they won't care if they're wrong and they'll usually give you inflated #'s that aren't legit comps either. Currently in most areas with longer days on market and prices dropping, you 100% SHOULD NOT assume your future appraiser will come in that high, and in the even they come in lower, if you don't have much equity left in the deal that will kill your BRRR Strategy.

I personally use PML, but you can use HDML, then be ready to do a Rate and Term Refinance VS a cash out refi leaving minimal to none of your cash in the deal and then go to the next one.  The problem with the real BRRR strategy is that so many folks are doing a cash out refi, they become over leveraged.  

It's BEST to find a GREAT deal with a lot of equity giving you way more room for multiple exit strategies just incase but with the main focus of keeping as a rental.

Best of luck :)

 This was good Jesse.