Has anyone used BRRRR with Bank financing?

[Gary C Jones]

Watched Brandon Turner's BRRRR webinar tonight and was curious about stories of anyone successful at using this strategy with bank financing. ???

[Scott Hollister]

Hello @Gary C Jones,

Brandon does a great job teaching! 

I have currently have one BRRRR under my belt and I think what you would call one with bank financing. I bought a house that needed some work(all cosmetic) with bank financing, you have to be careful here. A bank WILL NOT finance a deal if it is not in livable condition.

UNLESS you get a rehab loan in which the house must be livable after the contractor is finished. Look into 203k rehab loans, I hear its great but there are drawbacks. For instance you have to use a licensed contractor, not you. 

The BRRRR strategy will work with 203k but remember you will be losing some profit because you're paying someone else for the sweat equity you were going to put in.

My BRRRR number example:

Purchase price: 101k

ARV: 187k

Rehab: 10k

If I were to pay someone for rehab I would "lose" another 10k or so. But some would say that I could've used my time in a higher and better use like finding more deals and surrounding myself with a team. 

Good luck Gary!