@Scott Bidwell This will be my first post, but it seems like an interesting problem. Assuming you don't have additional non-W2 income, you probably will not be able to close with conventional loan on (I assume, your primary residence). I think it would make sense to purchase cash. The next steps I think after step 0 above are:
1. Move in a renter (house hack), if you are willing, to subsidize your living expenses which should now be low since you don't have a mortgage (most of the time, your largest expense). (-$450,000)
2. Since this is a networking site go to NETWORK above and
a. Find a member in your area that is investing with the BRRRR method (As you specifically asked about it); Offer to work with them for free to get the experience. Think of how to offer value by learning more about the strategy itself. Pay for your living expenses out of your savings. I assume you can live on $40k/yr with no mortgage even with no renter. This gives you a year to make progress. (- $40,000)
b. Contact Hard Money Lender to learn their criteria
c. If possible you may want to sign up for 'Rookie Bootcamp Weekend' happening April 30th - May 1st (Learn strategy and network more)
3. To keep from overleveraging your remaining $1M, find a property (again after learning BRRRR) with ARV in the $250k to $500k range. Since you aim to refinance at 75% after having a renter, you will need to be all in (with repair cost) at $187.5k to $375k. The hard money lender which you found in the 'NETWORK' tab will put up lets say 80% of the all-in-money (you need to also account for closing and interest cost), and you put up 20% which is $37.5k to $75k. This seems doable with your capital. Even if you could do it without the hard money lender, it is probably good to go through the process to learn the ins and outs.
4. Refinance as the 3rd 'R' in BRRRR and get back your $37.5k to $75k on a property which you should now have $62.5k to $125k in equity coupled with positive cash flow.
5. The next BRRRR you can do with private money as you will have built some relationships, credibility and experience. The above is only year one. You could accelerate after going through the process once.
I also think you need to learn the strategy even if you were to be a private money lender as you would need to be able to discern if the investor that brings the deal to you is accounting for everything. Whether you lose money being inexperience or lose money lending to an investor that may be inexperience, you still lose money. Hopefully this makes sense.
