Analyzing a BRRRR Deal

[Nova Mendoza]

Analyzing a deal that I initially have $200 cash flow on with the BRRRR Calculator then with the REFI section I calculate a higher interest rate so then my cash flow drops down to $56. What do investors typically look for when they REFI a BRRRR deal? I hear $200 per door is good but is that after the REFI?

[Jaysen Medhurst]

Unless your credit is a mess, @Nova Mendoza, you should be able to get a much better rate than that. Call all of your local banks and CUs. See what they're offering.

With a BRRRR you ideally spend (purchase + reno + holding costs) only ~75% of the property's ARV. So when you refi with a new appraisal you have that equity in the property. For Example:

• Buy for $50k
• Reno + Holding costs are $25k
• ARV for refi is $100k

Finance at $75k, pulling out all of your capital and giving you $25k of equity in the property.