All Forum Posts by: Chad Mercedes

Hey Chad, congrats on the rental and moving towards BRRRR! With your experience, it definitely makes sense to handle most of the renovations yourself—it could save you a lot.

For financing, you could consider a hard money loan to cover the purchase and rehab. These are typically higher interst, short term loans. Once the project is complete and the property is stabilized, you can look into refinancing with a DSCR loan, which focuses on the property's cash flow rather than your personal income. Check out this article: https://www.biggerpockets.com/blog/brrrr-loans-what-are-the-...

Would love to connect with you and chat further about this!

Hi @
Chad Mercedes

Transitioning to the BRRRR strategy can be a great way to build your rental portfolio, especially with your experience in renovations. Here are some thoughts on your plan: can be a great way to build your rental portfolio, especially with your experience in renovations. Here are some thoughts on your plan: Cost Savings: Doing the majority of the renovations yourself can significantly reduce costs. You'll save on labor and can invest those savings back into the property.
Value Addition: With your expertise, you’ll likely be able to add more value to the property through your renovations than a contractor might. Once renovation is done,  you could refinance it to pull out equity for your next project.. If you need some help about the funding, DM me. I might be able to help. 

Hi Chad,

I know a lot of investors that have a similar background to you that do the majority of the work themselves. If there is an area where you are not as confident like plumbing, electrical work, etc... then you can always find a subcontractor for that. 

For ongoing projects, I would recommend a rehab loan. These are typically one year, interest-only, with no prepays. The lender will fund a large percentage of the purchase price (up to 85-90%) plus the full rehab costs. The total loan amount for the purchase and rehab can't exceed 75% of the after repair value of the property. For these loans, the rehab is funded on a reimbursement basis. Once you finish the rehab, you can then refinance using a DSCR loan.

Do you have enough funds saved up to start buying properties or do you need to refinance your current rental?