All Forum Posts by: Clint G.

Just did EVP (engineered vinyl plank) throughout the entire house in my BRRRR. One of the reasons my tenant chose my house is because it had no carpet. He has dogs, so it's a plus for him.

@Dovi Zagelbaum

I went to a local CU and got a construction loan for my BRRRR. It's much cheaper than a hard money loan, and myself and the sellers were ok with a typical 30 day close. The loan also automatically rolls into a 15 year note if I want it to.

If you buy right, rehab and cash out refi, there is potential for you to get money back above and beyond the total amount you have in the deal. 

Example....let's say you're all in after purchase, rehab, closing/holding cost at 75k. We'll assume you can get a cash out refi at 75% of your ARV. If your ARV is 100k, then you break even with the cash out (75% x 100k = 75k). You now have a new loan of 75k. If your ARV is more than 100k then you could walk away with some cash back in your pocket after the refi.

So, if you're ARV comes back at 125k and you finance 75% of it with a new loan of $93,750, then you pocket the difference between your original investment of 75k and the new loan of $93,750.... or $18,750 in your pocket that's tax free and can be used for whatever you want.

I'd second asking for the past two years worth of tax returns. 

@Connor Ryan

The toughest part for me is coming up with an ARV. I have to rely on an agent to pull comes which isn't always ideal.

Also consider as appreciation happens, rents should go up as well. That could bring you out of a negative cash flow situation in a couple years. 

You might be able to get a commercial loan on it that is asset based, but I'm not 100% sure on that. 

I'm not sure how you could get into it with financing closing cost (maybe a HELOC or a LOC for that 6k), but I would recommend looking into a construction loan from a local credit union. This is what I'm doing now. I chose this over hard money because the fees are like a normal conventional loan (1% of loan amount and few smaller fees for appraisals etc). I'll pay interest only for 6 months. Nothing like I would have had to pay for hard money (I explored that option as well). The credit union I'm using will automatically roll the loan into a 15 year note if I want, but I'll cash out refi later on to a 30 yr.

Don't forget you've got holding cost with that hard money, and at 12% it won't be cheap. Have plenty in reserves for holding costs. The more reserves you have will also be helpful come refinance time.

@Haleigh Fulmer I'll be working but hopefully I can make the next one.

@Joshua Morgan this is the meetup info.

@Joshua Morgan

There is a other thread going around with a meetup. I'll try to find it and tag you.