BRRRR Strategy Loans — Buy, Rehab, Rent, Refinance, Repeat
The BRRRR method is the most powerful wealth-building strategy in real estate investing — buy a distressed property, renovate it, rent it, refinance to pull your equity back out, then repeat. We fund every phase: the acquisition, the rehab, and the DSCR refinance at the end. Texas and 45 states.
What We Fund in the BRRRR Cycle
- Buy: Hard money or fix & flip loan — close in 5–10 days, no income docs
- Rehab: Renovation funds released in draws as work is completed
- Rent: Place a tenant at market rent (or use STR/Airbnb income)
- Refinance: DSCR 30-year fixed — qualify on rental income, not your W-2
- Repeat: Use cash-out proceeds to fund the next deal
A Complete BRRRR Example
| Phase | Action | Numbers |
|---|---|---|
| Buy | Hard money loan closes in 7 days | Purchase: $140,000 | Loan: $112,000 (80%) |
| Rehab | Renovation draws released as work completes | Rehab cost: $35,000 | Funded in draws |
| Rent | Place tenant at market rent | Rent: $1,800/mo | ARV: $240,000 |
| Refinance | DSCR refi at stabilized value | 75% × $240,000 = $180,000 loan |
| Result | Pay off hard money, pocket difference | Cash back: $180,000 − $112,000 − $35,000 = $33,000 |
| Repeat | $33,000 seeds next deal | Portfolio grows, rinse and repeat |
Why BRRRR Works Better With a DSCR Exit
The refi is where BRRRR succeeds or fails. Conventional loans cap you at 10 financed properties and require 2 years of tax returns. DSCR loans have no property limit, require no income documentation, and close in 14–21 days. Every property qualifies on its own cash flow. This is why serious BRRRR investors almost exclusively use DSCR for the refinance leg.
BRRRR Loan Terms
| Phase | Loan Type | Max LTV/LTC | Rate | Term | Close Time |
|---|---|---|---|---|---|
| Acquisition | Hard money / fix & flip | 80–90% of cost | 9% – 13% | 6–18 mo | 5–10 days |
| Rehab funding | Draw schedule (same loan) | 100% of rehab | Same as above | Same loan | 24–48 hrs per draw |
| Refinance (exit) | DSCR 30-yr fixed | 75% of ARV | 7.5% – 10% | 30 yr | 14–21 days |
The Key to a Successful BRRRR: The ARV Gap
BRRRR only works if the After Repair Value (ARV) is significantly higher than your total cost basis (purchase + rehab). The bigger the gap, the more equity you manufacture — and the more cash you can pull out at refinance while staying under 75% LTV.
Target: ARV ≥ 1.4× your total cost basis. Example: $175,000 total cost (purchase + rehab) → needs $245,000+ ARV to pull all capital back out at 75% LTV. Deals where ARV is only 1.1× cost basis leave too little margin and tie up capital.
Common BRRRR Mistakes We See
- Overestimating ARV: Use conservative comps — what has actually sold, not what’s listed
- Underestimating rehab: Always add a 10–15% contingency to your rehab budget
- Waiting too long to place a tenant: Vacancy during the seasoning period burns holding costs
- No seasoning = lower refinance LTV: Some DSCR programs require 6 months from purchase before cash-out refi. Plan for this.
- Wrong market: BRRRR works best in markets with a wide spread between distressed prices and retail values — not in tight markets where nothing sells at a discount
BRRRR FAQ
How soon can I refinance after completing the BRRRR?
Most DSCR programs require a 6-month seasoning period from the date of purchase before allowing a cash-out refinance. Some portfolio programs have no seasoning requirement if you paid cash or used hard money to purchase. The 6-month clock starts at the purchase date, not the rehab completion date — so completing renovations quickly and placing a tenant fast shortens your effective wait time.
Do I need a tenant in place to refinance?
Not necessarily. On DSCR programs, we can use the market rent schedule from the appraisal if the property is between tenants. A signed lease at market rent helps your DSCR calculation and speeds up the refi, but it’s not always required. Having a tenant in place is ideal — both for the DSCR math and for the lender’s comfort level.
Can I do BRRRR in an LLC?
Yes — both the acquisition loan and the DSCR refinance can be in an LLC’s name. We lend to LLCs on all BRRRR-related programs. The personal guarantee requirement applies on both legs. Many serious BRRRR investors hold each property in a separate LLC for liability isolation.
Is there a limit to how many times I can BRRRR?
No. Unlike conventional Fannie/Freddie loans (which cap at 10 properties), DSCR loans have no property count limit. Each property qualifies independently on its own rental income. Investors with 20, 30, 50+ properties all DSCR financed are common clients. The only limit is finding good deals and having the equity/capital to fund the acquisition phase.
Ready to start or scale your BRRRR portfolio? Apply today — we fund the acquisition and the refinance. Call 877-895-3634.