All Forum Posts by: Garrett M.

Welcome to the forums @Josh Flaucher! The BRRRR strategy is awesome.

How would it work in Portland?  Portland prices must be very high these days, no?

I make it work in Philly where you can buy and renovate in B and C neighborhoods for 100K then rent for $1200 to $1400 and then pull out all your cash through the refi.

How many units are you working toward? Be sure to listen to the Clayton Morris podcast that goes into achieving your freedom number.

Best of luck to you!

I'd vote that you apply the BRRRR strategy. Buy and rehab a C/D house in a B area with cash and some credit if you need it. Then get it rented and cash flowing and refinance your cash back out of the property and repeat. You may be able to generate a surplus of cash if the ARV comes back higher than anticipated. You could repay your cash back into the bank, have 25% equity in a cash flowing property and make some extra capital in the process. BRRRR beats flipping because you keep the asset, you potentially make the same profit you could on a flip, and you get all the other benefits of rentals: interest payment deductions, depreciation over 27.5 years, leveraging your equity to purchase other properties, and dont forget about the potential appreciation of both future rent prices and the property itself.

Hello @Eric Greene-

Welcome to Bigger Pockets! I agree with your choices of neighborhoods to invest within Philadelphia. East Falls is pretty expensive I think, but I guess it depends on your strategy. I work the BRRRR strategy so I look to be all in for under 120k. Whatever you do, make sure to buy at a significant discount and you'll be good.

Best of luck to you!

@Paul Defngin

Hello, do they still call them helocs if they are on investment properties? Do you know whether they will lend on a property owned by an LLC?

Thanks for your post! 

@Luke M.

Can I ask you for the name of your lender? Do they lend on properties owned in an LLC? thanks!

@Charity Skore 

Hi, I saw above, you mentioned that you can help people get lines of credit on investment properties.

Is it possible to arrange lines of credit on them if the properties are owned in an LLC? Thanks for your post!

Thanks @Account Closed for that very helpful and very comprehensive list! I love BP and folks like you who make it great!

Hi @Michael Badin. I will pm you to learn more about the properties. Thank you.

Aren't the closing costs involved with a cash out refinance a lot higher? My HELOC on my primary residence cost $99 to close. Are there higher closing costs if its a rental?

@Kyle J. Are the HELOCS you got on your rentals considered commercial or conventional? Thanks!

I find myself in an odd position. I just got back the appraised ARV value on my first BRRRR deal and I was hoping for/ expecting a value of 140K. Well, it came back at 180K. I don't actually believe the home is worth that much.

My total cost to purchase and gut renovate the 3 bed 1 bath rowhome was 110K. I was hoping to simply cover my costs and have the 110K back to use on my next purchase and renovation. It seems like I will be able to borrow 135K as cash out on the deal, but I don't know if its wise to take that much out against it. There will be very little actual equity in the house if I borrow all the money.

If I only borrow 110K, my monthly principle, interest, taxes and insurance ( PITI ) will be $745. To borrow 135K will cost $875 per month. The loan is a commercial cash out refinance at 4.75% with a 5 year rate reset and a 10 year balloon.

The property rents for $1,350 per month. I was thinking it would be wise to keep my payment as low as possible, but this seems like an opportunity to borrow at a low rate.

I am trying to grow my portfolio quickly and I do have another purchase lined up. What would you guys suggest? Is there a reason not to take the larger loan? Any advice is appreciated! 

Thanks in advance!