BRRR Strategy Explained #shorts #propertyinvestment #propertyuk

[XCALIBURSHOES]

The issue is that you're exposed to falling home prices. If prices fall your equity is whipped out in the short term. This strategy only works if you can refi for a 15 year mortgage and hold until the mortgage is paid off. Then after 15 years you'll own all properties outright at 100% equity. Its a long-term strategy that ties up your capital ($75k in this example) for 15+ years. Overall, its a solid model if you don't need the liquidity.

[billyt]

Finding houses to 'do up' is gettin harder and harder.

[dabznslugg]

If the tenant don't pay or can't rent it all fall like domino

[Baebon]

and that required you to have 75k in saving. Which is difficult. I saved for 5 years and barely scrapped together 60k.

[tabassumkhanmum]

What’s your EMI from bank & what’s per month rent you receiving ?

[kevinboyle]

So what happens when the tenant stops paying rent for months on end, after the section 8 you have to go to court for possession order then for a warrant of possession, then get the bailiffs, then get your property back which is trashed, and the tenant has no money, so no point going to the courts on that, so you have to cover the cost of the repairs, plus the lost rental which was covering your mortgage which your paying? I know not all tenants are like this, but if it happens when you do this, you are going to need another source to cover the costs, so....

[ORIGINALdodi]

It’s not as easy as it sounds, although it’s very possible but without the correct know how, education & knowledge it’s just a dream for many.

[renegade]

What about when the WEF change the landscape - “You’ll own nothing and be happy”. This method used to work a charm but seems the powers that be are making it less feasible.

[themanhimself]

If it’s a 75% LTV then do you not have to put the 25% down?

[fuzzygreysocks]

Doesn't that 75% refi create a monthly mortgage that barely cash flows over rent?

[karimsalame]

Can you refinance if you started with your own money? I thought that for refinancing you needed a mortgage in the first place..can you confirm?

[MrFizzyhouse]

The bank still owns the house you never own any of the houses until the mortgage is payed off.

[Abf_-oqps]

You’ll only get it back if it’s your own money. You can do this with OPM and essentially not use any of your own if structured correctly.

[er.harshagrawal]

What about the monthly EMI ? The emi of debt on 75k will be more than your rental income?
Unless you have a rental yield of 14 or more this method won’t work.

Kindly Correct me if wrong

[benbrewer]

Do you have a mortgage broker that you would recommend?

[palakondarayuduuppu]

So if tenant skips for 3 months, ur house is up for auction that too with 50% discount.

[bigjak]

Youll never find a house up the street for half the price what needs doing up. Back in 2002 you could.

[ZenityStudios]

But after refinance you have a mortgage which is debt, which is factored into your ability to get next loan for new house. after a couple you will have too much debt to be approved for a loan. too high debt to income ratio or no?

[edwinhunnet]

When you refinance the interest rates are higher.

[asmith]

Lol. Assuming of course u can get a 100k valued house for 50k, not likely and even less chance of doing it more than once.