First Time Investor With Questions

[Hannah Bishop]

I am looking to purchase a property in Atlanta, GA using the BRRRR method. I've spoken to hard money lenders and will be using that, but I am unemployed so the refinance part is where I'm stuck. I've researched DSCR. loans, but a lot of of people are saying to get pre-approved for one before even purchasing the property. Is this the route to go?

[Michael Dumler]

@Hannah Bishop, as noted, you will need to go the non-QM route to refinance the deal. To be upfront, there's a lot of risk with your strategy. Depending on the terms/conditions of your hard money loan, you'll need to move quickly. Moreover, make sure you are factoring in all closing costs including the initial acquisition of the property and the refinance. Your double closing fees will likely cost thousands, be aware. Lastly, you need to understand ARV and market conditions religiously if you plan to tackle a BRRRR deal. Atlanta is still experiencing a strong seller's market but not as aggressive as we saw in 2021 and early 2022 where home prices were rising at a ridiculous rate due to low inventory and high buying demand. All and all, for this to be successful, you need to acquire the deal well below market value, which means you'll most likely need to source the property off-market and go direct to the seller. Hope this all makes sense and helps!