BRRRR question from a newbie

[Jacob Dodson]

House is being listed for $300k. ARV is roughly 375k. What is my offer on it? Somehow the calculator is confusing me.

Secondly, how does the refi pay off my hard money? Does it have to be rented before I can refi?

[Evan Polaski]

@Jacob Dodson, you did not provide all of the info needed.

But the name of BRRRR outlines the steps: Buy, rehab, RENT, refi. The only layer you are adding is the hard money on the buy. So you use that money to buy and rehab. Then you get it rented (your lease will help the bank feel more comfortable with the loan, since they will know the property is self sufficient).

The one issue with this model with hard money (not an issue a much as a cost to account for): most banks will want 12 months of seasoning before they will refi based on ARV. Some will do 6, but with the current uncertainty, those are harder to find. Just plan to have that hard money loan out for 12 months or more, and the interest associated with it.