Funding for out of state BRRRR

[Kyle Williams]

Hi I’m new to the investing world and I am seeking advice. Most of the deals that I’m finding are out of the state I live in. And I’m finding really good deals that would be a great first project to finally apply the Brrrr method. Does anyone have experience with getting funding out of their home state and investing in another like what are the steps and any advise would be helpful. I’m super eager to just start my first project. 

[Carlos Valencia]

Hello Kyle, 

I would highly advise not to invest out of state from where you live if your a new investor and never done this before. There's many things that can go wrong and if you don't have boots on the floor it will become very stressful for you and you will have created a nightmare and maybe throw in the towel and never want to invest again. Good contractors are hard to find and if they know you wont be around there's a high risk that they will just take your money and not get anything done. I believe this is probably the biggest challenge when investing out of state. You will want to make sure your on top of your contractors to make sure they are working. 

I would highly recommend to  find a deal in your backyard if possible. Not sure where you area you live but try to look for properties that are in your budget and that will make sense for you to invest. You can start with a small project like a condo, mobile home with affix land those two projects usually are not as expensive to do depending on the area. Rehab cost can potentially be lower. 

Ways to finance these projects are using hard money, you can also use conventional loans where you can finance as owner occupied but they cannot be properties that are not livable they need to be properties were you can actually live in. Many of our clients including my team use the owner occupied strategy to acquire the property with as low as 3.5 % down and rehab their property while living there. Once its completed you can either rent it out, sell it or continue to live there and house hack it meaning you basically have roommates to help you pay for your mortgage. Hope this helps and good luck on your search. 

@Albert Bui @Matthew Kwan