A lot of investors think the hard part of BRRRR is finding the deal and finishing the rehab.

I don’t agree.

I think the refinance is where a lot of deals get exposed.

Why? Because that’s the moment you find out whether the numbers actually work or whether they just looked good on paper.

Yes, pulling cash out through a refi can be powerful. But just because the cash is not taxable does not mean the deal is automatically healthy.

If the new payment kills your cash flow, your reserves are thin, or your margins were too tight to begin with, that refinance can create more pressure than freedom.

That’s why I keep telling investors the same thing:

Do not just underwrite the purchase.
Do not just underwrite the rehab.
Underwrite the refinance like it’s the most important part of the whole deal.

Because in BRRRR, it usually is.

Curious what others are seeing right now.

Are more BRRRR deals getting stuck at the refinance because investors overestimated ARV and underestimated expenses?