For the previous 2 months, I have been assisting a buddy look for his first financial investment residential or commercial property. John currently resides in warm Southern California and works a complete time job. He initially became interested in buying rental residential or commercial properties out of state for the benefit of passive income and wealth building. He connected to me a couple months back and revealed his interest in doing his first BRRRR project. Remember from my previous post that BRRRR means "Buy, Rehab, Rent, Refinance, Repeat."

His objective is to buy a distressed residential or commercial property with his own cash, rehab it to increase worth, rent it out and after that complete a money out re-finance to pull all his cash back out. Always delighted to help a good friend start on the path towards monetary independence, I gladly required.

For those thinking about discovering more about the BRRRR technique, have a look at my recent blog site post: "A BRRR is Worth all the Stress"

At the beginning of the process, I introduced John to my group, that includes my real estate agent, contractor, residential or commercial property manager, lender and insurance broker. Remember, you just can not prosper regularly in this company without a gifted team, and every group member is essential for the success of his investment.

As we began the process of recognizing his first offer, I revealed him how to quickly examine prospective residential or commercial properties and what red flags to look out for. Red flags include residential or commercial properties that have actually been on the market for months, and residential or commercial properties that have had numerous price decreases, as these things suggest the potential that something is troublesome with the residential or commercial property.

Though residential or commercial properties with warnings may terrify off a prospective purchaser, it needs to not be avoided as long as the numbers make good sense. We did have a guideline to prevent all residential or commercial properties that had major structure problems, electrical/plumbing repairs or extensive mold