How to Use Hard Money for the BRRRR Method
The BRRRR method: Buy, Renovate, Rent, Refinance, Repeat has become a go-to strategy for real estate investors looking to build long-term wealth through rental properties. While it’s often associated with long-term loans, hard money can be a powerful tool to kick off the BRRRR process, especially in competitive markets like Florida where speed and cash-on-hand are critical.
What Is the BRRRR Method?
The BRRRR method is a real estate investment strategy that allows investors to:
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Buy undervalued or distressed properties
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Renovate to increase property value
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Rent to generate monthly cash flow
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Refinance to pull out the equity
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Repeat the process with new properties
The goal is to build a scalable portfolio of income-producing rentals while recycling the same capital through each deal.
Why Use Hard Money for BRRRR?
Hard money loans are especially useful during the Buy and Renovate stages of BRRRR. Here’s why:
Speed Matters in Competitive Markets
Florida’s real estate market moves fast. Hard money loans let you close in days instead of weeks, giving you an advantage over other buyers using traditional financing.
Asset-Based Lending
Hard money lenders focus on the property’s value, not your credit score. This makes it easier to access capital, even if you’re early in your investing journey or working on multiple projects.
Renovation-Ready Funding
Banks rarely fund fixer-uppers, but hard money lenders specialize in them. You can get financing for both the purchase and rehab costs, allowing you to take full control of the value-add process.
Step-by-Step: Using Hard Money in the BRRRR Strategy
1. Buy
Use a hard money loan from a lender like Comcap to purchase a distressed or undervalued property. These loans are ideal for deals that require fast closing or properties that don’t qualify for traditional mortgages.
2. Renovate
Leverage your loan to complete renovations that improve the property’s value. Many hard money loans include funding in stages, giving you the flexibility to manage costs as the work progresses.
3. Rent
Once renovations are complete, find a reliable tenant and start collecting rent. This step confirms the property’s potential as a long-term income-producing asset.
4. Refinance
After stabilizing the property with a few months of rental income, refinance into a long-term mortgage. This allows you to pay off the hard money loan and recover your original investment.
5. Repeat
With your capital back and the property still producing cash flow, you can use the same strategy to acquire your next investment.
Final Thoughts: Hard Money as a BRRRR Launchpad
Although the BRRRR strategy is focused on long-term rental income, it begins with short-term action, and that’s where hard money loans provide an edge. At Comcap, we help Florida investors move quickly, fund renovations, and build lasting portfolios.
Interested in using hard money for your next BRRRR deal?
Reach out today to learn more about our flexible, fast real estate investment loans.
