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Build a rental portfolio by recycling capital. Learn how to finance each stage of the Buy, Rehab, Rent, Refinance, Repeat strategy.
Key Takeaways
BRRRR stands for Buy, Rehab, Rent, Refinance, Repeat—a real estate investment strategy that allows you to build a rental portfolio while recycling your capital. Instead of leaving money trapped in each property, you pull your equity out and redeploy it into the next deal.
1.0-1.25
minimum DSCR ratio required by most lenders
Source: Fannie Mae
No W-2s
required - DSCR loans qualify based on property cash flow, not personal income
Source: Clear House Lending Market Data
620-680
minimum credit score typically required for DSCR loans
Source: Clear House Lending Market Data
75-80%
maximum LTV for DSCR investment property loans
Source: Freddie Mac Investor Resources
The BRRRR method requires two types of financing: short-term debt for the "Buy + Rehab" phase, and long-term debt for the "Refinance" phase. Here's how each works:
For the initial purchase and renovation, you'll typically use short-term financing:
After renovation and tenant placement, you refinance into permanent financing:
DSCR loans qualify based on the property's rental income, not your personal income or tax returns. This is critical for BRRRR investors who often have multiple properties and complex finances that don't fit conventional lending guidelines. There's also no limit on the number of DSCR loans you can have.
| Purchase Price | $150,000 |
| Renovation Budget | $40,000 |
| Total Investment | $190,000 |
| Hard Money Loan (85% of purchase + 100% rehab) | $167,500 |
| Cash Out of Pocket | $22,500 + closing costs |
| After-Repair Value (ARV) | $250,000 |
| Monthly Rent | $1,800 |
| DSCR Refinance (75% LTV) | $187,500 |
| Pay Off Hard Money Loan | -$167,500 |
| Less Closing Costs | -$5,000 |
| Cash Back to Investor | $15,000 |
Result: Investor recovers most of their original $22,500 investment plus gains a cash-flowing rental property. The recovered capital can fund the next BRRRR deal.
Most lenders require a "seasoning period" before you can refinance based on the new appraised value:
Some DSCR lenders offer "delayed financing" or short seasoning programs specifically for BRRRR investors.
The property must have sufficient rental income to cover the new mortgage payment. Target DSCR of 1.0x or higher (1.25x+ for best rates).
Use our DSCR Calculator to check if your property qualifies →
The property must be rent-ready (completed rehab) and ideally occupied by a tenant with a lease in place.
Clear House Lending provides financing for both phases of the BRRRR strategy. We'll help you secure acquisition financing and have refinance options ready for when your project is complete.
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