Want to learn how to underwrite your own BRRRR or rental property deals? Get a free copy of the proforma! Get a free copy of the proforma! https://privatelending.llc/get-our-rental-proforma
We built a rental property underwriting tool that we use to help investors understand whether a deal actually works, and we're making it available to the public for free.
In this video, I walk through the calculator from start to finish using an actual duplex as a case study.
The biggest question isn't just, "What is this property worth?"
It's:
How much can I afford to pay for this property based on what I am trying to accomplish?
That's what good underwriting helps you answer.
In this walkthrough, we cover:
• How to build a rent roll and analyze current vs. market rents • How to build an operating expense pro forma • Current in-place performance vs. stabilized performance • How to calculate NOI and expense ratio • How vacancy, taxes, insurance, reserves, and other expenses impact your numbers • How DSCR works and why it can limit how much a bank will lend, regardless of the property's appraised value • How to model your acquisition, rehab, and eventual refinance • How much cash you'll have left in the deal after refinancing • How much equity you've created through forced appreciation • How to calculate cash-on-cash return • How to determine whether a BRRRR deal actually makes sense • How to stress test a property for higher expenses and higher interest rates • Where hard money and bridge financing can fit into a BRRRR strategy
Most importantly, I walk through how all of these numbers work together.
A property can be a bad deal at its current rents and a great deal after stabilization. But that only matters if your assumptions about rents, expenses, rehab, value, and financing are realistic.
The goal is not to make the spreadsheet tell you what you want to hear.
The goal is to know your numbers well enough before you buy that you have some margin for error when the real world doesn't go exactly according to plan.
GET THE FREE BRRRR / RENTAL PROPERTY DEAL ANALYZER
Reach out to Private Lending LLC and we'll send you a copy of the tool.
NEED FUNDING?
Private Lending LLC provides hard money and bridge financing for real estate investors in Virginia and West Virginia.
If you have a property that needs to be acquired, renovated, stabilized, and refinanced into permanent financing, that's exactly the type of deal we work with.
Contact us through our website: