BRRRR in US from out of country (as a Canadian)

8 Replies

Hi,

My name is Dragan and I am Canadian real estate investor. I live in Toronto and I already did a few fix and flips here in past few years, however as prices started going insanely higher I decided to change my focus to US market through out of country investing.

By thinking about BRRRR strategy I started putting my ducks in a row and planning for proper setup and strategy before I start investing. By that I mean everything from establishing best entity to legally cover my strategy as a Canadian investing in US (double taxation and liabilities), finding lenders that are willing to work with Canadian in US, finding quality agents, contractors and property managers in landlord friendly US states (Arizona, Texas, Florida).

BRRRR strategy is something that has fascinated me ever since I first heard about it a few years ago from Brandon Turner, but I still haven't come across someone from Canada who is successfully doing BRRRR in the US.

To be honest, I do have a few friends who have bought US properties and were able to refinance them using TD, BMO or RBC bank (banks that have both Canadian and US branches), but those cases are rare and very limited, and usually limited to 1 or 2 refinanced properties only.

Therefore I would like to reach out to the, IMHO, best real estate community online, the Bigger Pockets family, and possibly connect with fellow Canadians who have figured it out, found a lender(s) who is willing to issue multiple long term loans and by-that cover 20-30 (or even more) loans in the future, and are currently successfully owning a portfolio of real estates in US using BRRRR method.

If you have such experience, I would like to hear your story and how you did it?

To all fellow Canadians: I am sure there are a lot of us, seeing insane opportunities in US market, but maybe we still have some doubts and questions. I know I do.

Please don’t be shy to reply, share your story, offer your knowledge or just say hi. I am sure it will help a lot of people just to know that they are not all alone trying to figure things out in real estate world.

Thank you all and stay safe 

Dragan

I am looking to do something similar once the border opens. I have had a house in Goodyear AZ for years and have opened a HELOC looking to buy an investment property. I will be looking to do a cash out refinance but it might have to wait until I am employed again. Had no time to find a property while employed and banks won't lend to you when you don't have a job.

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Hey @Dragan Jeremic

I live in Ottawa and invest in South Bend, IN. I wholesale, do fix and flips, turnkeys and am in the process of building my own portfolio. The BRRR strategy is possible from out of county but is just a little more challenging as retail banks don't like to lend to foreigners. The risk is too high should something so wrong and they don't want to have to chase you in another country.

I sent you a pm with some accounting advice. I set up a Canadian Corp. here in Canada and a LP in the US. My Canadian corp is the general partner (1%) and I am the limited partner (99%). This offers the benefits of the flow through provisions of the CRA so you don't have to pay taxes twice and offers some protection for your personal assets. 

You are correct, TD and RBC offer cross border programs that allow you to bank in both Canada and the US. TD US will lend on the east coast and RBC has some pretty funky LTVs to work with but they are worth investigating. If you set up a commercial account, be prepared to travel to the US to set it up. You will need your ITIN #, EIN # and entity registration. 

Long term loans are most prevelent with asset based lenders. They charge more in interest, but will lend to entities because they use the property (asset) as leverage rather than your personal credit score. 

Hope this helps. Feel free to connect any time. I'm happy to share. 

Hi, I'm also a Canadian investor wanting to setup an entity in the US and needing accounting/financing advice. Would like to connect with others who have already experienced the BRRRR method as a Canadian Investor in the US.
thanks! 

Hey @Dragan Jeremic I am a fellow Canadian investor. I invest in Oshawa 2-units and did BRRRR's years ago, great strategy. Yes Toronto is on fire right now too.

It looks like @Stephen Fryer has this process figured out. reach out to him.

...I have been operating as a mostly U.S loan consultant and have a few lenders that help Canadiens invest in the U.S. I have a partner that does private money loans all over the U.S. Very responsive and provides term sheets in 1-2 days. They always answer their phone. 20% of their business is from Canadiens. Perfect for a BRRRR deal.

Hi @Stephen Fryer and @Dragan Jeremic I am also interested in learning more about this; would you be able to share your insights about the process? the only thing putting me off are the cross-border implications / travel back and forth and ideally a US-based team that can help/aligned goals. I know the money is in doing it mostly yourself vs. turnkey but still learning before i jump with both feet in - I'm also based in GTA/Ontario