Updated almost 9 years ago on . Most recent reply
BRRR Hang Up
I love the idea of BRRR. But timing doesn't make sense to me. I get that you buy, rehab, rent, refinance, and repeat, but can someone set the average timeline for me simply? So...what bank/regulations allow for any of this to happen in under 6 months? I had a realtor tell me years ago you can't even do a new appraisal until you hit 6 months (I had a home I sold that someone offered my list price at, then the appraisal came in 6k under listing, so they couldn't get financing from a bank, and the realtor told me you couldn't resubmit once the appraisal was done without going through submitting that the appraisal was inaccurate.)
Does anyone have a government reference on how long you have to wait before you get a reappraisal? Is it different per bank, or is it a state-monitored reporting thing appraisers have to do?
My bottom line is, if I want to buy a home for 200k, it appraises for 200k at closing, BRRR it, and in 3 months of work I think it's worth 250k, but the appraisal process won't allow me to do so until 6 months (and the bank won't even consider a new value until we have a year's worth of new rent), how can I possibly do 25-50 rentals in the first year??). I very much want to roll the BRRR method, but it doesn't make sense. Can someone explain this?