BRRRR stands for Buy, Rehab, Rent, Refinance, Repeat. Essentially, investors buy up properties, rehab what is necessary to make the properties livable and safe, rent out the properties to recoup what they have invested, refinance at a lower rate to reduce the selling price on the property, sell it off (if they so desire), and then repeat.
The BRRRR Method is very similar to this old building and loan business model, except that it’s a real estate investor that is borrowing money to fix up and buy a property before turning it into a rental cash cow.
Different lending options and loan programs can be used to purchase the properties in question. However, you have to be very careful when selecting a loan product to purchase a property.
Wait a few months after you start accumulating the rent. A traditional lender will require a seasoning period of a year or more of continuous payments on a property before you can refinance.
Repeat this as often as you have a consistent cash flow available to you through the cash-out process on a previous property. It will keep a chain of properties in your pocket, turning out passive income while you rehab your next project.