New BRRRR Portfolio Strategy | Valor Lending Group
Would you like to learn about the New BRRRR Portfolio Strategy?
Valor Lending Group is here to help with all of your real estate strategy needs!
What is BRRRR (buy, rehab, rent, refinance, repeat) and how can I capitalize on this method?
BRRRR is a real estate strategy that involves BUYING distressed investment properties. REHAB the properties. RENT the properties. REFINANCE the properties to pull cash out to purchase more investment properties to REPEAT the process all over again. If done correctly, this method can skyrocket your passive income and grow your real estate schedule to monumental proportions.
B is for BUYING
Finding a distress property to purchase is the easy part. Its the financing that could be the hard. Valor Lending Group has over 100 lenders that specially fund investment Bridge, Fix and Flip, DSCR, and Construction loans. No matter what level of rehab the property is in, Valor Lending Group can find the right lender for you.
- All Cash Purchase
Purchasing all cash would be an ideal situation for a couple reasons because first, you would be able to compete with cash buyers and cash buyers are the buyers that will typically win the bidding war because there are usually no contingencies and they can close very quickly. Second, you have the full equity to of the property to pull out as much as you need for the rehab and purchase of the next property you have your sights set on.
- Rental Property Loan
A typical scenario in which you would utilize an investment property program would be if you are purchasing a property that is move in ready or already has tenants occupying the property. This program is available with as little as 20% down payment. In addition, there are also full document financing available for the borrowers that can qualify using tax returns and additional income verification.
- Fix and Flip Loan
When you are flipping and you want to utilize financing, you will want to look into a fix and flip loan. It is a short term loan of 12 to 24 months that can include up to 100% of your rehab budget financed and as little as 10% as down payment on the purchase.
R is for REHAB
Rehabbing a property is the most time consuming stage of the BRRRR method. Making sure it is safe, habitable, and up to the rental market standards in your area is very crucial. There should be some thought about the level of upgrades the property needs depending on its location and market rents. You never want to under or over rehab a property in a specific neighborhood.
R is for Rent
Renting your newly rehabbed property to new tenants is one of the most important stage of the BRRRR real estate strategy. This will lock in your passive income and able you to continue your BRRRR method. Many investment property loans are based strictly off of gross monthly rent and the ability to cover the principle, interest, taxes, and insurance payment. Getting the highest and best rental income will become a key factor into the BRRRR equation. Seem more on financing below.
R is for Refinancing
Refinancing the newly rehabbed property is very important. This will allow you to access equity to purchase more properties to build your SREO. Most common investment property financing is a DSCR loan. DSCR stands for Debt Service Coverage Ratio. The ability to produce enough rent to completely cover their PITI payments. The higher the ratio gets, the easier it becomes for that entity or person to obtain financing for the investment property. DSCR is gross rents divided by new PITI (principal, interest, taxes and insurance) monthly payment. If your property is collecting rents that covers your current PITI payment your property debt services. This program is excellent for investors due to no taxes or income.
R is for Repeat
Repeat is the final stage of the BRRRR method. Repeat the stages in order to maximize your real estate wealth. When repeating, always take notes during the process so you know what worked and what didn’t on the next round of the BRRRR method
Whether you’re a avid real estate investor or purchasing your first investment property, the BRRRR method can be used to your advantage.
Please do not hesitate to call me today to discuss our New BRRRR Portfolio Strategy.
Valor Lending Group can fund your fast-hard money loan up to $10mm in as little as 7 days often without an appraisal.
Recap of our Loan Products:
- Hard Money Loans (20% down / minimal documentation) Typically Fund in 7-10 days.
- Stated Income Loans (Great for business owners and self employed ) No tax returns!
- 100% financing is available (we can cross collateralize other properties if there is enough equity)
- Valor VA Home Loan 100% financing up to $1.5MM
- Rental Property Loan – No tax returns or DTI calculation! Based on subject property cash flow – No DSCR Coverage needed!
- Flipper & Rehab Loans (Flip a property with one of our many options)
- 2nd Position Loans up to $5mm
- Raw Land & Lot Loans
- Ground up Construction for spec homes, custom homes and commercial ground up.
- Farms, Vineyards, Ranches and Agricultural Properties (25-30% down)
- Manufactured Housing / Mobile Homes (20% down / 600+ credit score)
- Acreage Properties
- Commercial Loans up to $500mm
- 3% & 5% down Conventional Loans– LPMI (Lender paid mortgage insurance)
- Foreign Nationals Loans (no social security or residency required)
We Also Offer
- Conventional Conforming Loans
- High Balance Conforming
- Jumbo Loan Financing to $10 Million / 10% down Jumbo to $1.5mm
- FHA, USDA
- Reverse mortgages up to $1 Million Value
- Cash Out Refinancing
New BRRRR Portfolio Strategy | Valor Lending Group
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