All Forum Posts by: Arron Paulino

I am currently in the process of doing my fifth BRRRR and have met an obstacle. I was able to save up enough to do this on my own and do the BRRRR process for my first few rental properties. I was able to buy the property cash, but have run out of liquid capital to fund the rehab. My options are to wait until I am able to refinance my fourth property in order to have the funds to do the rehab for property five (which won't be until early next year, has anyone done this option before?) or find a private lender to fund the rehab of this project. I have used hard money lending on one of my properties, but prefer not to because of the upfront fees that are needed. I am more comfortable paying interest only monthly or a lump sum at the end. My question is: How do I structure an offer to a private lender (friend and/or family) so that they are comfortable and I can ease them into funding my rehab? I definitely want a win-win situation so that it can turn into a future tool I can utilize after the lender is paid out. Any advice is welcome and much appreciated!

Note: I have done a couple private lending partnerships before diving into building my rental portfolio just to get my feet wet so I know how a promissory note works. Ideally, this is what I'd like to do and I'd essentially be the borrower this time around.

Hello Biggerpockets,

I currently have done 4 BRRRR's and am having fun doing it on my real estate investing journey! My first and second ones went well and I did have to keep some funds left in the deal when I cashed out during my refinance, but made it seem like a down payment in my mind. This is good, however, I can only do this so many times as I know I will run out of liquid capital to continue funding future BRRRR's to build my real estate portfolio. My third rental property was bought during COVID and my insurance provider dinged me for needing to change my asbestos siding which cost me double what I had planned for the rehab bid. This essentially deterred my ability to scale my portfolio. My fourth property seemed like a reach since I may have overpaid for it during the purchase price, but had a normal rehab budget. In all, I use these experiences as learning lessons for me going forward.

Currently, I have enough funds to purchase another property, but am short on the rehab budget or vice versa. I will not be able to cashout refinance my fourth property until early next year. With how my BRRRR's have gone on the previous properties, I am not sure if a hard money loan makes much sense since I've been leaving cash in the deal after refinancing. Maybe I need to use OPM to fund my deals going forward. I am seeking advice in terms of scaling going forward for my future deals. Purchase prices for properties have been going up for what I'm looking for. Any advice will be greatly appreciated!

 Yes, this is the standard 30-year fixed rate for this loan. I do want to maximize the cashflow for this property long-term and am leaning with the first option. I understand what you are saying and appreciate your response!

Yeah the people I've been contacting increased their rates due to Fannie Mae and Freddie Mac changes. I used to get those rates you speak of before those changes. I currently have the property under my name and am BRRRR investing in Memphis, TN. I do not mind getting more info about those lenders if you don't mind sharing!

I am in the process of cash out refinancing one of my rental properties to complete the BRRRR method. The person doing my loan has offered me two choices:

- 4.5% with 2 points or 4.875% with 1.375 points

I have calculated the ARV of the property to be $70,000 and I will be able to cash out refinance 70% of the loan. The amount I anticipate to be given to be is ~$50,000. My question is: what option is better if I am pursuing the BRRRR method and playing to buy and hold this property long-term? Thanks in advance!

Hello! I'm currently doing a couple BRRRR's on the side and continuing to build my rental portfolio. What I am trying to do right now is possibly transition into a job where I can not only keep my W-2 income steady but also learn more about the real estate investing process. I'm interested in property management, transaction coordination, banking industry, and maybe do some office work for a construction company. I enjoyed analyzing numbers and am very detail-oriented. Currently, I am in the hospitality industry so I am strong in customer service and member relations. Any advice will be greatly appreciated!

I'm in the process of purchasing a property that I have under contract. I am a little short of purchase price so I have resorted to borrowing from either hard money or private money (which I'm beginning to learn that it's better to use other people's money (OPM) when possible/once I learn how to master this technique). This will be my first time using a hard money lender and if all goes seamlessly, plan to do it again. I have found a hard money lender that has considered me for the amount of $45,000.00 ($15,000.00 Purchase Funds+ $30,000.00 Rehab Holdback) with a rate of 12% and loan term of 6 months. More information on the hard money loan as follows:

$2,500.00 Origination Fee, $500.00 Loan Processing Fee, plus all
reasonable closing costs, including but not limited to appraisals, title work,
legal, etc. The Desktop Appraisal worth $250.00 is also going to be added
to the fees on this Term Sheet.

The purchase price of this property is $28,000 plus closing costs and my rehab bid has come in at $32,500. My anticipated ARV for the property is around $65,000 on the conservative side and I know I will have money left in the property once refinanced. I'll have to pay the "down payment" of $13k plus the other fees associated with the loan and closing. I've already put in an earnest money deposit of $500. I don't plan to be late on any payments so my question is how will the refinance part work out? Guessing I'll just have to find out the seasoning period from the cashout refinance lender. I have one in mind and assume the rates will be between 3.75-4.5%, 30 year conventional loan. Am I doing this whole thing correctly? I'm just jotting this down and hope to get help clarifying what's in my head. My exit strategy is the BRRRR/buy and hold for my rental portfolio. Thanks!

They're good people man! Glad to hear you were able to grab one of their properties listed. I'm currently working on doing my own BRRRR's so I can build my rental portfolio. It's a great feeling to take action!

 I have not personally talked to other investors that have invested with MartelTurnkey, but I have reached out to Antoine directly on Instagram and he's been able to point me in the right direction! I even read his book that's been informative for my real estate journey. I've messaged other members of their staff and they are all friendly and helpful in answering my questions. Their service is legit and their properties don't last too long on the website so you have to be fast!

Hi Lynn!!! It's been a journey and I'm really immersing into it. Antoine's been a great influence for me and guided me to see things with more clarity. I've been able to dive deeper in understanding the Memphis market and working on adding to my rental portfolio there. Would love to connect with you to talk further!