THE LEVER
Ask a forum if BRRRR still works and you'll practically get laughed out of the virtual room. "Rates killed it." "Margins are too slim." "Go buy an index fund."
Here's what actually died: the 2021 version, where you refi'd out after buying too high, blowing your reno budget by 10%, but still got a $30K check and called it a strategy. That check was a rate environment arbitrage more than anything. The BRRRR strategy, however, is alive and well.
Purchase: $145K. Reno budget: $59K. The hard money note covered both, plus fees: $208K total, at 69% of projected ARV. Cash to close: $1,450. And no monthly interest during the hold. Fees rolled into payoff.
Reno wraps and appraisal comes in at $315K. Refi into a DSCR cash-out, pay off the note and the deferred fee, cover closing costs, and the check at the end to the client is still several thousand.
Underwhelming, right? Read it again though. He put in $1,450, got nearly five times that back, and owns a $315K rental. It cashflows, comfortably, because he didn't have to max leverage to clear the note.
Now to be clear, the deal worked because of the great buy on the front end. This wasn't a hatchet job renovation to make up margin on a bad buy. This also wasn't max leverage.
The cash-out was never the strategy. The strategy is recycling the same small pile of capital into door after door.
This week: run your next deal at today's rates with a deferred-fee hard money note. Find the basis where the refi clears. That's your buy box. Call me if you have questions.
THE W
Two this week. First, the team just had our highest inbound volume week ever. Second, on a personal note: I'm getting back into local off-market deal acquisitions. Will keep you posted.
THE L
We ran a man down this week, which slowed us some. And we swapped out some back-end vendors. Long run, it 10x's what we can do. Short run, real admin pain. Worth it. Still annoying.
ON THE RADAR
- AI for admin. I met with two guys this week to help them set up personal AI systems for their businesses. The takeaway: AI doesn't make you a robot. It handles the robot work so you can be more human with your clients. Especially true with HNW clients.
- STR distress. I'm reading more and more about short sales ramping up in overheated STR markets. Look at Orlando. I've personally worked short sales with an investor adding to his portfolio, and if you're set up for it, this is a GREAT buying window.
LIFE
I'm late, I know. Thank you all for your patience.
I want to dedicate this to my late Grandfather, who was awesome, but had terrible Dad jokes.
How do you surprise a unique rabbit?... You neek up on it!!
Love you PopPop
Cheers,
Wyatt
The Leverage Letter | When you know the game, nobody can play you.
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Subscribe to The Leverage LetterNumbers reflect one real, closed 2026 client file, anonymized. Rates and terms are that deal's, not a quote or a commitment to lend. All loans subject to credit approval and underwriting. Next in the archive: a live Charlotte sixplex underwrite on a DSCR loan.