How much money do you need to start BRRRR?

Enough to cover the part of the purchase a short-term lender will not fund, plus the rehab, closing costs, points, interest and holding costs. On a $300,000 purchase with $60,000 of rehab and a 90% hard money loan, that is about $120,000.

Hard money lenders typically fund 85 to 90% of the purchase. On $300,000 at 90%, you bring $30,000. Add about $6,000 in closing costs, $5,400 in points, and the $60,000 rehab, which most investors pay as work is completed.

Interest on $270,000 at 11% is about $2,475 a month, and taxes, insurance and utilities on an empty house add $700 to $1,000. Over six months that is roughly $20,000 more. Keep a 10 to 15% rehab contingency on top. Cheaper markets scale this down to $30,000 or so. Most of it returns at the refinance if the deal was bought right.