Just completed my 1st BRRRR in VA

Just completed my 1st BRRRR in VA

Realtor · Richmond, VA · Member since 2017 · 118 posts · 113 votes

Hey BP! I just closed on the Refinance portion of my first ever deal, a BRRRR. I guess once I "Repeat" then I would have actually completed the BRRRR process. For reference, I've listened to the podcast for about a year. In Summer of 2018, my wife and I took out a HELOC on our primary home in Richmond, VA, as it had appreciated in value greatly in just our two years of ownership. We opened the HELOC and sat on it so we'd have it ready when the time came, and in January 2019, got a phone call from a mutual friend who is a wholesaler in the area. We had met a few months prior, and he called to let me know he had a house under contract that was in the ballpark of my HELOC amount, and thought it may be a perfect first deal for me.

The process actually went relatively smoothly, except for having to fire a contractor. Essentially, he oversold his ability to finish the attic, was doing a poor job on drywall, and I had to fire him and hire a new guy. This swap in contractors cost me an additional $4,000. The house was a 900 sq ft single family with 2 bed, 1 bath and a walk-up unfinished attic. The main work done: refinished the hardwood floors, painted throughout, and finished the attic. Now it's a 3 bed, 1 bath, and 1250 sq ft.

Here are some numbers:

Purchase Price: $61,000 (paid for using HELOC)

Rehab Cost: $17,000 (paid with personal savings)

All-in Price: $78,000

ARV: $105,000 (based on appraisal from refinance process)

Rent: $1,000/month (Lease signed mid-project)

At the end of it all, I had to leave about $4,000 in the deal. The ARV wasn't quite high enough to get all my money back out when I refinanced, the fire/re-hire of a contractor hurt me a little, and the closing costs were higher than anticipated. But, for my first deal I'm thrilled, just got my my money back out, and will be looking for deal #2!

Some before pics:

And some after pics:

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Real Estate Agent · Richmond, VA · Member since 2012 · 15 posts · 9 votes
7y

Very cool. Thanks for sharing your success. I'm looking for a lender to refinance a rental property. Who did you deal with and how did that process work? Congrats good luck with number 2.

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  • Rental Property Investor · Philadelphia · Member since 2018 · 24 posts · 9 votes
    7y

    Great job and Congrats!!

    Question, Did you purchase the home through an entity such as an LLC or your personal name ?

  • Realtor · Richmond, VA · Member since 2017 · 118 posts · 113 votes
    7y
    Originally posted by @Mahauijue Mack:

    Great job and Congrats!!

    Question, Did you purchase the home through an entity such as an LLC or your personal name ?

    No LLC yet

  • Member since 2019 · 1 post · 0 votes
    7y

    @Brandon Spurlock nicely done!

  • Realtor · Miami, FL · Member since 2019 · 1 post · 0 votes
    7y

    @Ned Rennolds thanks for sharing and good luck

  • Real Estate Agent · Arbutus, MD · Member since 2019 · 127 posts · 59 votes
    7y

    @Brandon Spurlock

    Nice. I bought my first property in 2012 and finally BRRRed it. Just did my cash out refi.

    Mind me asking what they charged you to refi? Mine cost around $12k, seemed high. But my first go round and due to not being owner occupied that’s why it was more expensive.

    Looking for my next purchase now.

  • Rental Property Investor · Tysons, VA · Member since 2015 · 73 posts · 45 votes
    7y

    @Brandon Spurlock Nice work. Would you mind sharing zip code of Richmond of this project? Tenant profile like job etc.

  • Rental Property Investor · Member since 2019 · 45 posts · 15 votes
    7y

    @Brandon Spurlock that’s awesome man. I’m in the middle of doing my first one now and it’s exhausting but exhilarating. I love what you did to the home. Do you mind telling me where you found your wholesaler? Also are you planning on using a property manager or doing it yourself?

  • Frisco, TX · Member since 2019 · 9 posts · 7 votes
    7y
    Awesome job and congrats!
  • Flipper/Rehabber · Newport News, VA · Member since 2016 · 128 posts · 54 votes
    7y

    @Brandon Spurlock great job. Congratulations!!

  • Realtor · Richmond, VA · Member since 2017 · 118 posts · 113 votes
    7y
    Originally posted by @Chris Mcdonald:

    @Brandon Spurlock


    Mind me asking what they charged you to refi? Mine cost around $12k, seemed high. But my first go round and due to not being owner occupied that’s why it was more expensive.

    Hey Chris, my closing was about $4500 for the refi.

  • Realtor · Richmond, VA · Member since 2017 · 118 posts · 113 votes
    7y
    Originally posted by @Jasmine Hu:

    @Brandon Spurlock Nice work. Would you mind sharing zip code of Richmond of this project? Tenant profile like job etc.

    This was in Hopewell, VA - 23860.

  • Realtor · Richmond, VA · Member since 2017 · 118 posts · 113 votes
    7y
    Originally posted by @Brent T Galbreath:

    @Brandon Spurlock that’s awesome man. I’m in the middle of doing my first one now and it’s exhausting but exhilarating. I love what you did to the home. Do you mind telling me where you found your wholesaler? Also are you planning on using a property manager or doing it yourself?

    I met my wholesaler through a mutual friend. Didn't think a TON about it at the time, but he called me on this property, remembering the amount of my HELOC and wanting to tee me up for a good project. I owe most of this to him, as he allowed me to make money at the time of purchase.

    For now, I'm self-managing and using Cozy. It made the application process easy to screen, and I had to pass on about 5 applicants before landing with my current tenant. I found a well-liked manager in the area, and will probably turn the property over to them once I add a 2nd property.

  • Rental Property Investor · New York, NY · Member since 2019 · 7 posts · 2 votes
    7y

    @Brandon Spurlock Great work and glad it all went well. Very impressive.

  • Flipper/Rehabber · Winchester, VA · Member since 2019 · 56 posts · 16 votes
    7y

    @Brandon Spurlock

    Thanks for sharing! It is encouraging to hear the success stories. Looking forward to hearing about the next one!

    How did you meet the wholesaler who fed you the property?

  • Rental Property Investor · Castle Rock, CO · Member since 2019 · 13 posts · 3 votes
    7y

    @Brandon Spurlock Congrats!! Thanks for the motivation to get my first one done as well. Very inspiring.

  • Member since 2019 · 1 post · 0 votes
    7y

    @Brandon Spurlock let me know I have good hvac,plumbers, with dealing my my dads rentals. I am trying to get in the business on my own now. I can do general items. In mechanicsville va

  • Rental Property Investor · Davenport, FL · Member since 2016 · 593 posts · 382 votes
    7y

    @Brandon Spurlock

    Nicely done! On to the next. 

  • Member since 2019 · 4 posts · 0 votes
    7y

    @Brandon Spurlock. Nice!!!!

  • Member since 2019 · 4 posts · 0 votes
    7y

    @Brandon Spurlock. You took pictures sideways and want them straight?

  • Lender · Mid Atlantic Region · Member since 2018 · 1 post · 0 votes
    7y

    Congrats!

  • Flipper/Rehabber · Richmond, VA · Member since 2018 · 7 posts · 1 vote
    7y

    Great job Brandon! 

    I have a BRRR and a flip going in Hopewell as well. I have a few other deals out there that I am looking at if you're interested.

    Let’s connect!

    Wayne

  • Parker CermakPro Member
    Real Estate Agent · Bemidji, MN (Bemidji) · Member since 2019 · 20 posts · 7 votes
    7y

    @Brandon Spurlock good for you! Continue the success! Hope I can be there soon!

  • Hartford, CT · Member since 2018 · 14 posts · 7 votes
    7y

    @Brandon congratulations!

  • Las Vegas, NV · Member since 2014 · 10 posts · 1 vote
    7y

    Awesome job with adding a bedroom and sq footage!

  • Rental Property Investor · Ozone Park, NY · Member since 2019 · 36 posts · 20 votes
    7y

    @Brandon Spurlock

    Thanks for sharing. It gave me confidence. Don’t worry about the contractor situation. I’m sure the learning experience is invaluable. At least you didn’t get analysis paralysis and waited several years. I’m currently opening a heloc off of my small duplex. I’m searching for good deals currently. Calculating the mortgage, rent in the area and taxes of each house on the mls. Negotiating deals, offering 15% below market price based on many variables. But I found deals that were good enough, causing me not having to negotiate the market price..... one step at a time, it’s all a learning process. Good job Brandon 👍🏽

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