New Section 8 Investor Using a Full-Service Provider — Looking for Experienced Eyes

[Mike Hinton]

Hi everyone - Long‑time member, first‑time poster. After sitting on the sidelines for too long, I finally took action and closed on my first Section 8 rental in Alabama while living in California. I am taking the BRRRR approach.

I’m working with a service that handles the process end‑to‑end (acquisition, rehab, tenant placement, etc.), which has made the jump much more manageable. The property needed a fair amount of work, and according to the team, everything is now complete and ready to be listed next week.

Here’s where I’d love the community’s insight..... I want to make sure the deal itself is solid and that the numbers, rehab scope, and overall setup make sense from an experienced investor’s perspective. I’m confident in the direction I’m heading, but I also know that I don't know what I don’t know and I’d rather get feedback now than learn the hard way later.

If anyone here invests in Section 8, buys remotely, or has experience with turnkey or full‑service providers, I’d really appreciate your take.

- Do the deal fundamentals with your provider typically look right?

- Are there common pitfalls I should double‑check?

- Anything you’d want to verify if you were in my shoes?

I’m committed to building a strong portfolio and creating long‑term stability for my family. Just looking to validate that this first step is as solid as it appears. Happy to share numbers, rehab details, and the next deal I’m evaluating if anyone is willing to take a look.

Thanks in advance! 

Mike 

[Robert Ellis]

Quote from @Mike Hinton:

Quote from @Robert Ellis:

Quote from @Mike Hinton:

Hi everyone - Long‑time member, first‑time poster. After sitting on the sidelines for too long, I finally took action and closed on my first Section 8 rental in Alabama while living in California. I am taking the BRRRR approach.

I’m working with a service that handles the process end‑to‑end (acquisition, rehab, tenant placement, etc.), which has made the jump much more manageable. The property needed a fair amount of work, and according to the team, everything is now complete and ready to be listed next week.

Here’s where I’d love the community’s insight..... I want to make sure the deal itself is solid and that the numbers, rehab scope, and overall setup make sense from an experienced investor’s perspective. I’m confident in the direction I’m heading, but I also know that I don't know what I don’t know and I’d rather get feedback now than learn the hard way later.

If anyone here invests in Section 8, buys remotely, or has experience with turnkey or full‑service providers, I’d really appreciate your take.

- Do the deal fundamentals with your provider typically look right?

- Are there common pitfalls I should double‑check?

- Anything you’d want to verify if you were in my shoes?

I’m committed to building a strong portfolio and creating long‑term stability for my family. Just looking to validate that this first step is as solid as it appears. Happy to share numbers, rehab details, and the next deal I’m evaluating if anyone is willing to take a look.

Thanks in advance! 

Mike 

The part that gets interesting is that you're taking the BRRRR approach with a full-service provider.

If I were in your shoes, the number I'd be focused on isn't the rehab budget—it's the refinance.

I've seen deals where the acquisition looked good, the rehab was completed, and a tenant was placed, but the appraisal came in lower than expected and the investor ended up leaving far more cash in the deal than they planned.

What ARV did they originally project, and what comparable sales are they using today now that the rehab is complete?

In my experience, that's usually where you find out whether the BRRRR performs the way it was modeled or whether the returns look different once the refinance happens.

 @Robert Ellis - The ARV is $140K. That said I am going through the refinance process right now. My hope is that ARV holds and I can recoup the anticipated funds that I budgeted for this project.

Based on your experience, when refinancing a Section 8 property, do you typically go for a DSCR loan or a traditional 30-year mortgage when you're refinancing?

DSCR is much quicker and allows for cash out refinance if you run all the numbers as much as possible. Not traditional financing. DSCR also isn't on personal credit.