How an Investor Turned a $145K Tired Duplex Into a $260K Cash-Flowing Asset in 9 Months
Sources: Small-Balance Commercial Refinance — PeerSense, Asset-Based Lending Hub
How did PeerSense solve this scenario?
$67K equity created, BRRRR exit to DSCR. A 36-year-old W-2 worker with a day job and two prior flips under his belt — both funded with his own cash. PeerSense placed the deal into arv / rehab with conservative leverage, asset-based underwriting, and fast execution. Composite case study based on the deals we close every month.
— PeerSense Composite Case Study · 2026-05-01
At a glance
| Acquisition price | $145K |
| Rehab budget | $48K (100% financed) |
| All-in basis | ~$193K |
| ARV (after rehab) | $260K |
| Loan size | $193K (purchase + rehab) |
| Rate | Interest-only |
| Term | 12 months |
| Property type | 2-unit duplex |
| Market | Indianapolis, IN |
| Exit | Refinanced onto 30-year DSCR at $260K appraised value |
The borrower
A 36-year-old W-2 worker with a day job and two prior flips under his belt — both funded with his own cash. That self-funded model had a ceiling: he could only do one project at a time. He wanted to do three this year.
He'd identified a tired 2-unit duplex in a transitioning Indianapolis neighborhood that needed cosmetic and mechanical work — kitchens, baths, HVAC, paint, flooring, landscaping. Buying it with a conventional loan and paying for the rehab out of pocket would've consumed his liquidity completely. He needed financing that could fund both the purchase and the renovation work.
Why traditional financing said no
Conventional banks won't finance rehab work on investment properties. Hard money lenders will, but at 12-13% with 3-4 points up front — pricing that eats meaningfully into the profit on a value-add deal. He needed a structure that was purpose-built for the BRRRR (buy, renovate, rent, refinance, repeat) model.
How PeerSense solved it
We matched him with an ARV-based rehab program that financed 100% of the rehab budget against the as-repaired value of the property. He put down standard equity on the purchase but pulled rehab dollars in scheduled draws as work was completed and inspected.
The program structure:
- Purchase financing at standard LTC
- 100% of rehab budget financed against ARV
- 12-month interest-only term — runway to complete work, lease, and refinance
- Draw schedule tied to inspection milestones (typically 4-5 draws)
- Designed for BRRRR exit to a long-term DSCR loan
He completed the rehab in 7 months. Both units leased at market rent within 30 days of completion. At month 9 the property re-appraised at $260K (up from $145K acquisition + $48K rehab = $193K all-in basis). He refinanced onto a 30-year DSCR rental loan at the new value, pulled his rehab capital back out, and immediately deployed it into project #2.
The outcome
- All-in basis: ~$193K
- ARV after rehab: $260K (appraised)
- Net new equity created: $67K
- Both units leased, cash-flow positive
- Refinanced onto 30-year DSCR rental loan at month 9
- Recycled capital funded project #2 in month 11
Frequently asked questions
What's an ARV loan?+
A loan that's sized based on the property's **after-repair value** rather than the current as-is value. This allows investors to finance both the purchase and the rehab work, with the loan amount supported by what the property will be worth once the work is done.
Is an ARV loan the same as a hard money loan?+
Similar in some ways but typically structured differently. ARV programs are often more transparent, with scheduled draws, lower points, and a defined exit to long-term DSCR financing — built specifically for the BRRRR model.
How are rehab funds released?+
Through a draw schedule tied to inspection milestones. Typically 3-5 draws over the project lifecycle: initial draw, mid-project draws as work is completed, and a final draw upon completion and lease-up.
What kind of properties qualify for an ARV loan?+
Most programs accept 1-4 unit non-owner-occupied properties (single-family, condos, townhomes, 2-4 unit buildings). Some extend to small multifamily.
What's the typical term?+
Most ARV loans are 12-month interest-only, with possible extensions. The structure assumes you'll refinance into a long-term DSCR loan once the property is stabilized.
Can I do the BRRRR strategy with an ARV loan?+
Yes — that's the canonical use case. Buy with the ARV loan, renovate using financed rehab funds, rent the property, refinance onto a long-term DSCR loan at the new appraised value, and repeat.
Do I need rehab experience to qualify?+
Most programs will work with first-time rehabbers if you have a verified general contractor and a detailed scope of work. Experience helps with pricing but isn't always required. ---
Have a similar scenario?
Composite case studies based on the deals we close every month. PeerSense routes to the right program + lender.
Composite case study. Names, locations, identifying details, and dollar amounts modified to protect borrower privacy. Actual rates and terms vary by borrower, property, and market conditions. PeerSense is a capital advisory firm and does not directly originate loans.