Should we use our own money to rehab or take out a personal loan?

[Marlene Isma]

Hello!! My two sisters and I just brought our first 1,542 sqft 2/1 duplex for 350k. The property is a block concrete, built in 1967. Per the inspector, it has good bones and structure but just needs some TLC. Plumbing has updated in the last 3 years. Roofing and electrical were all updated last year. The place just needs some serious cosmetic work to bring this 1967 property to the year 2025. The property does not have Central AC, but has ac wall unit (flat roof but will upgrade to central.) For one unit, we might have to do full rehab on due to the long term (12yrs) tent not receiving upgrades to her unit so she have been left with a lot of interior designs that were original to the house and is now is bad condition. The other unit has been slightly upgraded since 2002 and it's been kept in a better position. Still needs work. All new windows and doors needs to be upgraded. And a lot of other stuff. We ran the numbers, our ROI is displaying positive cash flow after the first year with rehab. Also, one of us is planning to house hack in one of the units for a year. Estimate Rehab cost will probably around 45k. We our also planning to do the BRRRR method and do enough forced appreciation to gain equity by one year. We have no money to fund the rehab process as of right now but we're all working decent paying jobs. However, we have a timeframe in which we like to purchase the next property by next year. My question is should we just do more OT at work and use our own money to rehab or take out a personal loan to speed up the rehab process?? Please give me some advice! Thank you in advanced!

[Mohammed Rahman]

Hey hey! First off—huge congrats to you and your sisters! That’s a big move and it sounds like you snagged a solid value-add property with great bones and a plan in place. Love to see it.

Here's the deal: you're at a crossroads that every BRRRR investor hits—use your own cash (and grind it out slower), or use borrowed money (speed it up but take on risk). Since you're trying to scale and time matters, here's what to think about:

If your rehab estimate is around $45K, and you don’t have the cash sitting around, then yes—a personal loan or credit line could make sense if you’re confident in your numbers, the rehab plan, and your ability to refinance out. 

Just make sure the monthly payments on that loan won’t choke your cash flow while you’re holding it.

If one of you is house hacking, that definitely helps cushion some expenses while you rehab the other unit. You could even stagger the reno—focus on one unit first, rent it at a premium after upgrades, then roll that income toward fixing the other unit. 

That gives you a little breathing room and proof-of-concept before going deeper into debt.

But if you’re not comfortable taking on that debt—or if the interest rates are ugly—it’s not crazy to grind it out with OT and piece the rehab together over a few months. 

It's slower, sure, but you stay in control and keep your risk lower. The only tradeoff is delaying the BRRRR refinance timeline a bit, which might push out your next purchase.

If it were me? I'd look into a low-interest personal loan, HELOC on another asset (if possible), or even a 0% intro APR credit card (with a real payoff plan), just to kickstart the work while still doing OT to pay it off fast.

Use a combo approach: borrow a chunk to cover big-ticket stuff (windows, HVAC install, kitchen/bath), and cash flow the rest through work.

You got options. Just make sure your numbers stay tight, your exit plan is clear, and you don't overextend. This first BRRRR is your launchpad—don't let it stall you out before the next one. Keep that momentum!