All Forum Posts by: Tarek Emam

@Neil Adams

This was a perfect explanation. Thank you Neil!

@Peter M.

Thank you peter!

Hello All,

I am looking for my first Brrrr property and my question is, when looking for properties to implement the BRRRR method, how bad of shape should a house be? Should the property be gutted to the studs? Should it be a light rehab. ( carpert, paint,) should it be a medium rehab ( bathroom updates, kitchen updates, flooring) etc. How beat up should the house buy when purchasing when implementing the BRRRR method.

Hey Gaetano, thanks for taking the time to read my post and replying. You mentioned you put a down payment of 14,500 through an FHA loan of 3.5 percent. Since you went through a conventional bank, this must mean the property wasn't in bad shape correct? In the BRRRR method, how bad of shape does a house need to be in, inorder to BRRRR it? And Secondly, you mentioned the rehab budget was 50K, did you use your own capital to fund this rehab or did you receive it from a lender?

Hello all, 

Purchase price: 200,000

Rehab: 50,000

All in: 250,000

ARV: 450,000

Here is a hypothetical example of a property, my question is if I need 250K ( 200,000 purchase price) ( 50,000) Rehab and I dont have much capital and I go to a lender and he tells me He can only loan me 90% of amount needed. Therefore 90% of 250,000 is 225,000. This means I need to put up 25,000 from my own pocket. So my question is, Can the lender loan the amount of the purchase price and the rehab budget combined? Since i need 200,000 to purchase the property and 50,000 to rehab it, does the hard money lender factor the rehab budget in the loan amount? 

Hello all,

I need some clarification on on wether or not BRRRR works on multi family homes. I am based in New Jersey and I'm a new investor. In jersey, multi family is definitely the way to go when it comes to investing in real estate out here in New Jersey. My question is, can BRRRR be done on a multi family? I have done a lot of research on BRRRR and I even bought Davids Greene book on BRRRR but it seems like in the beginning stages, he is only talking about the BRRRR method only being applied to single family home. Can BRRRR be done on multi family homes the same way it would be done on a SFH?

@David M.

Thank you very much for the clarification David ! I appreciate your time !

@David M.

Hey David, firstly i want to thank you for taking the time to break this down. Im following everything you are saying except for the part when you said “ you can cash out refi at 30% down, and the loan would now be at 455K” since I was at 340K in loans, how did I jump up to 455K in loans? Thats my first question.

My second question is when buying a property that needs some rehab work, i mentioned the property is set at 300K and needs 100K in rehab. If i dont have the liquid funds for the rehab, dont I need to take out a second loan or some type of borrowed funds for the rehab budget?

Just need some clarity on the BRRRR model.

Purchse price: $300,000

Rehab: $100,000

All in: $400,000

Appraisal:$650,000

Equity: $250,000

For this example, lets say I put down 20% of the purchase price ($60,000) as a down payment. And now the remaining amount on the loan is $240,000.

And i took out another loan for my rehab price quote at $100,000. So now I essentially owe $340,000 in total ($240,000 for the loan amount of the house) and ($100,000 for my rehab loan)

Now since my equity is only $250,000 and I owe a total of $340,000 back in loans, The BRRRR method wouldent work here correct? If this is correct can someone please let me know when the BRRRR method would work in a situation. Thank you!

@Randall Alan

Thank you for taking the time to help Randy. This was much help!