BRRRR - Buy, Rehab, Rent, Refinance, Repeat

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Core 4-BRRRR Edition

Posted Jun 5 2022, 20:59

Hey all. I am buying a property in Cleveland area to BRRRR. I am in the initial phases of getting a cash offer accepted. I have a pretty good realtor and property manager. I have a decent contractor lined up, though I have not worked with him yet, people have recommended him and their reviews seem legit. Last bit, which I guess is my question. Should I have a lender lined up and pre approved before rehab OR wait until rehab is done or nearing done until I get one in place? I am new to BRRRR, so any insight would be much appreciated! Also, I have not asked my realtor if he recommends any lenders yet, but does anyone have a Ohio lender they recommend? Thank you to the moon and back for any answers to my questions!

-Nick 

Cleveland, Ohio

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Miguel Hernandez
  • Rental Property Investor
  • West Covina, CA
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Miguel Hernandez
  • Rental Property Investor
  • West Covina, CA
Replied Jun 5 2022, 21:11
Quote from @Nicholas Creahan:

Hey all. I am buying a property in Cleveland area to BRRRR. I am in the initial phases of getting a cash offer accepted. I have a pretty good realtor and property manager. I have a decent contractor lined up, though I have not worked with him yet, people have recommended him and their reviews seem legit. Last bit, which I guess is my question. Should I have a lender lined up and pre approved before rehab OR wait until rehab is done or nearing done until I get one in place? I am new to BRRRR, so any insight would be much appreciated! Also, I have not asked my realtor if he recommends any lenders yet, but does anyone have a Ohio lender they recommend? Thank you to the moon and back for any answers to my questions!

-Nick 

Hey Nick, congrats on your investing journey. When you talk about a Lender, are you talking about the refinance period, or the purchase? 
I assume you’re talking about the refinance period. Having a lender to refinance your property when it’s all done is very important but I don’t think it is needed ASAP. Definitely shop around and see who can offer you the best terms. Since it is a BRRRR I assume the property needs some rehab work done, so that’ll give you a little time to shop around for the best terms.
Have you read David Green’s BRRRR book? He gives GREAT advice on what to look for when finding a lender to refinance your property. 
Goodluck I hope you’re able to close on a property soon!

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Shane Kelly
  • Real Estate Agent
  • Cleveland, OH
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Shane Kelly
  • Real Estate Agent
  • Cleveland, OH
Replied Jun 6 2022, 07:58

@Muhammad Amawi should be able to help you out on the lending question. And congrats on moving on a deal! I hope your offer is accepted and it works out for you.

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Steven Goldman
  • Lender
  • Pennsylvania
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Steven Goldman
  • Lender
  • Pennsylvania
Replied Jun 6 2022, 09:17

I suggest that you develop a relationship with a broker or lender who can advise you on the financing aspects of your scenarios. Throughout my real estate career I have always developed friendships with my core 4/5 or 6.  You should be able to call your financing advisor and get a honest opinion about your deal. Your entire project has to work. You need to know the approximate  numbers before you go under contract. Your financing relationship should be willing to analyze your deals quickly and regardless of the time of day or night. A good deal waits for no investor. When we are investing in Ohio we have an entire team including legal who can assist us in analyzing the transaction.  

In establishing your relationships you should find investigate if the agent, insurance agent, property manager, broker, lender or lawyer have actually been investors and really understand what you need. Their is no substitute for actual hands on experience. Good luck, real estate what a rush!

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Steven Wilson#5 Starting Out Contributor
  • Rental Property Investor
  • Columbus, OH
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Steven Wilson#5 Starting Out Contributor
  • Rental Property Investor
  • Columbus, OH
Replied Jun 6 2022, 09:34
Quote from @Nicholas Creahan:

Hey all. I am buying a property in Cleveland area to BRRRR. I am in the initial phases of getting a cash offer accepted. I have a pretty good realtor and property manager. I have a decent contractor lined up, though I have not worked with him yet, people have recommended him and their reviews seem legit. Last bit, which I guess is my question. Should I have a lender lined up and pre approved before rehab OR wait until rehab is done or nearing done until I get one in place? I am new to BRRRR, so any insight would be much appreciated! Also, I have not asked my realtor if he recommends any lenders yet, but does anyone have a Ohio lender they recommend? Thank you to the moon and back for any answers to my questions!

-Nick 


Congratulations Nick. 
Are you wanting to refinance? If so I would wait until you get the work done. Do you need the money for the rehab? Then I would be reaching out ASAP and try to get that. It is always good to ask your realtor and keep building that relationship. Because you want to create that core 4, realtor, property manager, lender, and contractor. I would start to shop around for lender pricing/rates. If you need some shoot me a message. 

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Nicholas Salman
  • Lender
  • Ohio
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Nicholas Salman
  • Lender
  • Ohio
Replied Jun 6 2022, 14:09

Hey, Nick congrats man! That's a super exciting first step on the journey. David Greene has an awesome book on the BRRRR strategy as I'm sure you have read. I would get your base contacts all down for every area needed and start to build that relationship. I don't do hard money but I have a very resourceful team who has done plenty of flips, BRRRR's and buy and holds. We can refi so you can pay off the hard money. Either way I am here if you need anything!

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Patrick Drury
  • Real Estate Agent
  • Columbus, OH & Cleveland OH
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Patrick Drury
  • Real Estate Agent
  • Columbus, OH & Cleveland OH
Replied Jun 6 2022, 14:52

@Nicholas Creahan
The best place to start looking for lenders would be your agent. Definitely ask them if they have any lender referrals before just looking about. It will save you a lot of time. Also, as for contracting them, you should be fine. If you are doing a BRRRR there isn't much sense in jumping the gun and reaching out till the project is completed/close to completion as long as it will be finished before the apprisal.

  • (614) 412-4565

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Muhammad Amawi
  • Investor
  • Cleveland
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Muhammad Amawi
  • Investor
  • Cleveland
Replied Jun 6 2022, 16:41

Hey Nick, congratulations on the first investment property!
I would say to wait as its nearing done to get pre approved, however to at least have someone lined up so you can have things moving right away when you're ready. I'm a lender native to the Cleveland area if you have any questions on anything.

Lender Ohio (#2335749)

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Cody Mitchell
  • Investor
  • College Station, Tx
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Cody Mitchell
  • Investor
  • College Station, Tx
Replied Jun 6 2022, 22:03

Congrats on beginning your journey. I personally would reach out to a several lenders. From there I would get what their interest rates are and get their assessment of your overall financial position and the deal. As you get close to finishing the rehab, that's when I would make a decision on the lender to use and go ahead and get the application process started then. Hope this helps! If you have any questions or if I can help at all feel free to shoot me a message. 

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Nicholas Misch
  • Real Estate Agent
  • Cleveland, OH
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Nicholas Misch
  • Real Estate Agent
  • Cleveland, OH
Replied Jun 8 2022, 11:22

It's not always possible but I like to have all my partners on board and at least aware and discussing what I am trying to do, so I can get any council early in the project. This has saved me from some big mistakes.