Help me analyze this deal

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Help me analyze this deal

Amy Wen-Mcgovern
Member since 2023 · 2 posts · 4 votes

Hello BP community,

I have about 5 rental properties and do a mix of LTR/MTR. I have been interested in doing a BRRR so this would be my first time doing so. I'd be using a bridge loan to fund this project and it will cost me about 70K out of pocket (this includes 15% DP, CC, and bridge loan monthly repayments x 4). At the end of this project, I will have two turnkey 3BR/2Ba houses on one parcel of land. Ideally would like to sell as 2 condos for maximum profit, but if town won't permit that, am willing to refinance and rent out with anticipated combined monthly rent of $4800. Since I'm new to BRRR, I always thought the goal was to get 100% of your money back. But in this scenario, ARV is only 10K more than bridge loan amount. Appreciate your insights.

View report

*This link comes directly from our calculators, based on information input by the member who posted.

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  • Jaycee GreenePro Member
    Real Estate Consultant · St. Louis MSA · Member since 2024 · 3k+ posts · 727 votes
    10mo
    Quote from @Amy Wen-Mcgovern:

    Hello BP community,

    I have about 5 rental properties and do a mix of LTR/MTR. I have been interested in doing a BRRR so this would be my first time doing so. I'd be using a bridge loan to fund this project and it will cost me about 70K out of pocket (this includes 15% DP, CC, and bridge loan monthly repayments x 4). At the end of this project, I will have two turnkey 3BR/2Ba houses on one parcel of land. Ideally would like to sell as 2 condos for maximum profit, but if town won't permit that, am willing to refinance and rent out with anticipated combined monthly rent of $4800. Since I'm new to BRRR, I always thought the goal was to get 100% of your money back. But in this scenario, ARV is only 10K more than bridge loan amount. Appreciate your insights.

    View report

    *This link comes directly from our calculators, based on information input by the member who posted.

    Hi @Amy Wen-Mcgovern, welcome to the BP Forum! Have you talked the city about this yet or are you waiting until the project is complete to make the request? 

    [email protected]
    0Reply
    • Amy Wen-Mcgovern
      OP
      Member since 2023 · 2 posts · 4 votes
      10mo
      Quote from @Jaycee Greene:
      Quote from @Amy Wen-Mcgovern:

      Hello BP community,

      I have about 5 rental properties and do a mix of LTR/MTR. I have been interested in doing a BRRR so this would be my first time doing so. I'd be using a bridge loan to fund this project and it will cost me about 70K out of pocket (this includes 15% DP, CC, and bridge loan monthly repayments x 4). At the end of this project, I will have two turnkey 3BR/2Ba houses on one parcel of land. Ideally would like to sell as 2 condos for maximum profit, but if town won't permit that, am willing to refinance and rent out with anticipated combined monthly rent of $4800. Since I'm new to BRRR, I always thought the goal was to get 100% of your money back. But in this scenario, ARV is only 10K more than bridge loan amount. Appreciate your insights.

      View report

      *This link comes directly from our calculators, based on information input by the member who posted.

      Hi @Amy Wen-Mcgovern, welcome to the BP Forum! Have you talked the city about this yet or are you waiting until the project is complete to make the request? 


       Hi Jaycee, I went on Friday afternoon and needless to say no one was available to address my questions. My plan is to go to town hall first thing tmrw morning.  

      1Reply
  • Frankie VozziBusiness Member
    Member since 2025 · 335 posts · 82 votes
    10mo

    Hey Amy! It sounds like you've done a fantastic job with your properties and diving into the BRRRR method! The scenario you've described definitely raises some important questions.

    The difference between the ARV and the total cost can be a bit tricky, Sometimes, it's all about finding the right financing strategy or even exploring alternative options to make sure you get the best return on your investment. I'd love to connect and chat more about your plans and see how we can help make this deal work for you!

    [email protected]516-888-7750
    0Reply
  • David Spurlock
    OH · Member since 2022 · 75 posts · 23 votes
    9mo

    Hey @Amy Wen-Mcgovern, I've got a couple of questions about this deal.

    I am curious why you are using a bridge loan over a hard-money loan, and would love to hear your thoughts. Why do you want to sell the two homes as condos instead of SFHs? On your report, what is the "Total Cash Needed at Purchase: $226,000" composed of?

    0Reply
  • JooYung Choi
    Realtor · NJ · Member since 2023 · 215 posts · 99 votes
    5mo

    A perfect BRRRR is extremely hard to come by nowadays unless you have an off market personal deal. I don't mind leaving money in a deal if cash on cash is strong. You could argue opportunity cost on a different deal but it will need to be better than the CoC on your BRRRR.

    0Reply
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