How It Works
The BRRRR strategy (Buy, Rehab, Rent, Refinance, Repeat) is popular among real estate investors because it can allow you to recycle capital and scale a portfolio. Executing it successfully generally requires appropriate financing at each distinct step.
Investors often start with short-term financing (like a bridge or fix and flip loan) to acquire the distressed property and fund renovations. Once the property is renovated and leased, a refinance into a long-term DSCR mortgage may allow the investor to recover capital based on the newly appraised After Repair Value (ARV). Refinancing is not guaranteed and depends on property performance, valuation, and lender underwriting at the time of application.
Key Benefits
Capital Recycling
If a refinance is available, investors may recover a significant portion of their initial investment to redeploy into additional properties.
Forced Appreciation
Strategic renovations can build equity, rather than relying solely on market appreciation.
Portfolio Velocity
Recycling capital can help investors acquire multiple properties over time, subject to financing availability and lender guidelines.
Typical Guidelines
Managing the financing transitions between acquisition and long-term hold is central to the BRRRR strategy. Refinancing is not guaranteed. Comparing wholesale programs can help identify appropriate financing at each stage. See our Bridge Loans and DSCR Loans pages for more.
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