BRRRR on tenant occupied units

[Mauricio Quintana]

Hi everyone,

I have a scenario where I'm a bit stumped. I'm currently looking at a package deal on a SFH and a duplex as one purchase. The monthly rents are $2,170. This is about $800 below market value. I see a big upside. The properties will need lots of work but the tenants are currently living and paying rent w/o many asks for improvement. My question is how do you BRRRR a deal with tenants in your property? I don't want to get a traditional FHA loan to start b/c the house won't appraise at a high enough value. However, I can't afford to use an interest-only/hard money loan since leases don't expire for another 10 months or so.

What do you recommend?  Any of you use other methods for financing based on the scenario above?

Thanks