Hi All, I'm new to the Bigger Pockets community and am excited to learn all I can about real estate investing! My questions are about the BRRRR strategy; curious to know who's done it and any pitfalls or things to note on the fore front. I'm particularly interested in single family homes in C-Class type neighborhoods. I am looking at the price point of about 50k for my first property, maybe get an ARV of 75k. I'm in Central Florida and will want to invest in the local market.
1) Will banks work with me on getting a refinance on a property as inexpensive as this? I'm just thinking they've got bigger deals to work on, and the risk exposure from their point of view on a cheap C class property may not be worth it to them.
2) How long would I have to have a tenant in place before I can even pitch this to a bank as a refinance? Are they looking for X amount of months?
Any advice on this from folks that have been investing in similar properties would be greatly appreciated!
Welcome to BP! I am also in Central FL. Bank programs will vary from place to place but most will be looking for a seasoning time based on how long you have owned the asset not how long it has had a tenant in place. As will anything everyone's rules will be a little different so you just have to start asking around until you find the right place to do the loan. Good luck!
Thanks for the advice Judson! I'll have to shop around and ask some banks what their seasoning time is. Do you think the value of the property being so low and the fact that it's in a C-Class type of neighborhood would preclude a lender from putting a mortgage on the property?
My goal is to go at the BRRRR strategy to build a portfolio; I just want to make sure it's feasible with the properties I'm seeking to acquire.
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