BRRR with 200-300k. Need advice

[Patrick Shep]

I'm in need of some strategy. I'll soon be getting a HELOC (150-190k) and can also take out a 50k loan from my 401k and around and 50k+ cash. I want to scale with concentrating on cash flow.

What kind of deals should I be looking at to go after? I was thinking about using it for undervalued houses (under 200k) 70% or less on ARV with no to light rehabs and refinance to get my cash back or should I thinking bigger leveraging HML to maximize my return? I would not want to leave any of my money from a the HELOC or 401k loan for more than 6 months, so I can rinse and repeat.

[Ko Kashiwagi]

Hi Patrick,

Typically less rehab there is, the less upside there is on the BRRRR, so you might leave some equity in the deal if you don't have much repairs to do. Also, because there is a seasoning requirement for refinances, you'd generally have to wait 3 months before you can refinance. Personally, if you have to wait 3 months anyways, it seems like a good idea to take on a project that takes 3 months to maximize returns. Finding undervalued properties is a great way to instantly build equity, but this takes a lot of work as well.