Deal snapshot
| Location | Fountain Square, Indianapolis, IN |
| Property type | Side-by-side duplex (2/1 per unit) |
| Loan type | Hard money BRRRR → Indiana DSCR refi |
| Loan amount | $166,000 bridge (85% LTC) → $150,500 DSCR refi |
| Close time | 10 business days acquisition |
Investor challenge
The sponsor needed to close an estate-sale duplex in Fountain Square before a faster cash buyer dropped price. Conventional financing could not meet the 10-day decision window, and one side still had a below-market tenant — rehab had to proceed with partial occupancy without blowing the draw schedule.
Jaken Finance Group’s solution
Jaken Finance Group structured 85% LTC hard money at 10.5% interest-only with four milestone draws tied to electrical, HVAC, kitchen/bath, and finish scopes. Proof of funds on Day 2 secured the contract; file closed on Day 10 with LLC vesting and line-item scope aligned to Marion County duplex comps.
Outcome
After $48,000 rehab and stabilization at $2,750/mo gross, the property appraised at $215,000. Indiana DSCR refi at 70% LTV returned ~$32,000 for the sponsor’s next Near Eastside acquisition.
Indiana DSCR hub: DSCR loans Indiana · hard money lenders Indianapolis · Fountain Square neighborhood
Acquisition
Property: Duplex — one side vacant, dated mechanicals, active tenant other side at below-market rent
Purchase: $118,000 · LLC vesting
Close: Day 10 · 85% LTC hard money at 10.5% IO
Seller situation: Estate — four offers, two conventional (30+ day), one cash lowball. Proof of funds Day 2 won.
Hard money and rehab
| Draw | Scope | Release |
|---|---|---|
| 1 | Panel, rough electrical, demo vacant side | 25% |
| 2 | HVAC both units, plumbing passed | 30% |
| 3 | Kitchens/baths, flooring | 25% |
| 4 | Finish + punch | 20% |
Total rehab: $48,000 · 11 months calendar (tenant coordination on occupied side)
DSCR refi math
| Item | Amount |
|---|---|
| Appraisal (stabilized) | $215,000 |
| DSCR loan (70% LTV) | $150,500 |
| Rate | 8.1% · 30-year |
| Monthly P&I | ~$1,108 |
NOI: Effective gross $2,585 after vacancy → NOI ~$1,770/mo → DSCR ~1.22 at lender file.
Cash out: ~$32,000 extracted toward next door.
Why this BRRRR cleared in a partially occupied building
Two things made this deal harder than a vacant flip — and the structure solved both. First, the 10-day estate window: a Day-2 proof of funds let the sponsor win against two conventional offers stuck in 30-day underwriting. Speed, not price, won the contract. Second, one side stayed occupied at below-market rent during rehab, so the draw schedule was sequenced unit-by-unit (vacant side first) to keep work moving without a tenant dispute.
The exit worked because Indiana is a genuine cash-flow market: at $2,750/mo gross on a $215K stabilized value, NOI cleared a ~1.22 DSCR even at a conservative 70% LTV. The key discipline was modeling Marion County taxes at the post-rehab assessed value, not the estate’s old bill — the single most common reason Indianapolis duplex refis miss coverage.
Takeaway: on occupied value-add, win on speed and sequence draws around the tenant; then let the rent — underwritten with honest taxes — size the cash-out.
Deal timeline — estate close through DSCR refi
| Phase | Duration | Milestone |
|---|---|---|
| LOI | Day 0 | Four offers on estate duplex — sponsor submits with Jaken Finance Group POF |
| Contract | Day 2 | Seller accepts — proof of funds beats two conventional buyers |
| Acquisition | Day 10 | $118,000 close — 85% LTC hard money at 10.5% IO |
| Rehab Draw 1 | Weeks 2–4 | Vacant side demo, panel upgrade, rough electrical |
| Rehab Draw 2 | Weeks 5–8 | HVAC both units, plumbing inspection passed |
| Rehab Draw 3 | Weeks 9–14 | Kitchens/baths, flooring — occupied side coordinated around tenant |
| Rehab Draw 4 | Weeks 15–18 | Finish, punch, exterior |
| Lease-up | Month 8 | Below-market tenant renewed at $1,375/mo; vacant side leased at $1,375/mo |
| Stabilization | Month 11 | Both units on 12-month leases; $2,750/mo gross documented |
| DSCR refi | Month 12 | $150,500 loan at 70% LTV on $215,000 appraisal — ~$32K cash extracted |
Total calendar: 12 months from acquisition to refi — 11 months rehab driven by occupied-side sequencing, not scope overrun.
Fountain Square and Marion County market context
Fountain Square sits southeast of downtown Indianapolis in Marion County — a neighborhood in active transition where 2010s-era duplexes trade at $95K–$130K distressed and $200K–$230K stabilized post-renovation. The sponsor’s $118K acquisition sat below the corridor median because one side carried a below-market tenant at $950/mo and the estate wanted certainty over price.
Indianapolis duplex rents in Fountain Square and adjacent Near Eastside blocks ran $1,300–$1,450/side for renovated 2/1 units in 2026 — the sponsor’s $1,375/side stabilization sat at market, not aspirational. Marion County property taxes reassess on sale; the sponsor modeled $385/mo taxes post-rehab vs the seller’s $210/mo pre-renovation bill — the single adjustment that separates Indianapolis BRRRR files that refi from files that miss DSCR coverage.
The Indiana Landlord-Tenant Act allows 30-day notice on month-to-month conversions, but the sponsor negotiated a lease renewal with the existing tenant at $1,375/mo rather than forcing turnover during rehab — avoiding 2–3 months vacancy on half the building that would have dropped gross rent to $2,325/mo and failed the refi.
Fountain Square’s proximity to Fletcher Place, Holy Cross, and the Culture Trail supports long-term appreciation on duplex holds — but this sponsor’s thesis was cash-flow extraction, not land banking. See hard money lenders Indianapolis for Marion County product parameters.
Full economics — bridge through refi
| Line item | Amount |
|---|---|
| Purchase | $118,000 |
| Rehab | $48,000 |
| All-in cost | $166,000 |
| Hard money (85% LTC) | $141,100 @ 10.5% IO |
| Sponsor cash in (gap + carry float) | ~$24,900 |
| Bridge carry (11 mo avg balance ~$130K @ 10.5%) | ~$12,550 |
| Appraisal at refi | $215,000 |
| DSCR loan (70% LTV) | $150,500 @ 8.1%, 30-year |
| Bridge balance at refi | −$118,500 |
| Refi closing costs | −$5,200 |
| Net cash extracted | ~$26,800 |
The sponsor self-funded portions of rehab between draws to keep the bridge balance at ~$118,500 at refi — below the $141,100 max LTC line. That discipline produced ~$26,800 net cash (rounded to ~$32,000 in the sponsor’s internal accounting including $5,200 in draw reimbursements released at final inspection). Retained equity: $64,500 ($215K − $150.5K).
Monthly cash flow post-refi:
| Line | Monthly |
|---|---|
| Gross rent | $2,750 |
| Vacancy (6%) | −$165 |
| Taxes + insurance | −$485 |
| Maintenance / PM (10%) | −$275 |
| NOI | $1,825 |
| P&I @ 8.1% on $150,500 | −$1,108 |
| Cash flow | ~$717/mo |
Flip alternative rejected at underwriting
| Exit path | Projected result |
|---|---|
| Retail sale at $225K ARV | ~$18K net after 8% costs, 12-month hold, IO carry |
| BRRRR refi (executed) | ~$32K extracted + $717/mo ongoing cash flow + retained asset |
The flip spread compressed because occupied-side rehab extended hold to 11 months — at that timeline, IO carry on $141K consumed $12,550 that a 5-month cosmetic flip would have avoided. The sponsor correctly pivoted to hold exit when Draw 2 revealed $11,200 in HVAC scope on both units — mechanical depth signals BRRRR, not flip velocity.
Operator lessons
Estate sales reward speed, not lowball price. The sponsor matched list price at $118K — the winning variable was Day-2 proof of funds, not a discount. Two conventional offers at $115K and $112K never cleared underwriting in time.
Sequence draws around occupancy. Draw schedule prioritized the vacant side first — occupied side kitchen/bath deferred to Draw 3 so the tenant kept a functional unit through months 1–8. Lenders who require full vacancy on duplex rehab would have disqualified this asset; milestone draws on partial occupancy required before/after photo documentation per unit.
Tax reassessment is not optional in pro forma. Marion County assessed the property at $198K post-rehab for tax purposes — sponsor’s $385/mo tax line at refi matched the bill within $12/mo. Files that model pre-sale tax bills on Indianapolis duplex refis consistently miss 0.08–0.12 DSCR points.
70% LTV discipline. Sponsor requested 75% LTV at refi; underwriting capped at 70% because side-by-side duplex product in Fountain Square carries thinner comp support than suburban Indianapolis duplexes. The 0.05 LTV reduction cost ~$10,750 in proceeds but cleared ratio at 1.22 DSCR without exception pricing.
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