All Forum Posts by: Brian Stinnett

Hey @Matthijs Pol! Sounds like you have a TON of options.

I am not sure how much you have looked into the BRRRR method, but having a phat HELOC puts you in a great position. You can purchase property cash, improve it and force appreciation, then get long term financing on the property after improvements are made. If done correctly, you could use the same line of credit to purchase many rentals!

Say you purchase a not so nice looking house for $180k, put $60k into it, and now it's worth $300k. You basically paid $240k for a home that's now worth $300k. If the bank gives you a mortgage for 80% of the value of the property after it's all fixed up, you can pull back out $240k (80% of $300k), pay off the line of credit to be used again, and you basically got the rental for free + $60k in equity. Obviously this is an ideal situation, and the property may or may not cashflow depending on a bunch of other factors, but that's the idea.

Your strategy will depend on your goals of course, but if I had access to a large enough line of credit this is what I'd be doing. Good luck!

@Ben Stoodley Thanks for that nugget Ben! There are definitely areas in Indiana where you can be all-in for around 75k so that is great to know!

@Ben Stoodley Thanks for the info Ben! Just to clarify, I am using an FHA loan to purchase my house-hack. As soon as I get settled in I will start working on finding distressed sellers/properties to purchase with hard money and rehab.

Hey BP people!

I am in the process of relocating to Northwest Indiana into my first house-hack and I want to start BRRRR investing in that area as soon as I get settled in. Most of my uncertainty is around the hard money lending process. If anyone that has used a hard money lender for this purpose can help clarify a few things, I'd greatly appreciate it!

-Is there some type of pre-approval process similar to a conventional loan? Or do I need to have a property under contract before reaching out to a hard money lender?

-How soon can I expect to receive funds from them? I'd love to offer a quick close for distressed sellers, and I'd hate to jerk sellers around making a cash offer before I have the funds and then something go wrong. 

-Can you tell me some typical terms you have experienced? Interest rate, repayment period, etc.  

I have been learning a ton from you all! Thank you for any insight you can offer.