Potential BRRR on Two Family - First Deal
I found a two family property on Homepath--it's currently in the lockup period but asking price is $325k and it needs some work (TBD on $$). Similar two families are worth over $400k ARV. If rentable, it would gross about $3,200/mo. Here's my plan. If I can get it for $325k with 25% down (call it $85k) and put another $35k into it, I can the rent it for $3,200 and earn a decent cash flow with a total of $120k into it.
At that point I can refinance at a $415k value for a loan of about $312k--pulling $60k about $60k out after fees, and still cash flowing.
My numbers are conservative but here are the areas where I'm unsure about.
How do I finance this? Should I use a hard money lender for purchase and rehab, or just use conventional loans for purchase, my own cash for rehab, and conventional loan for the refinance?