When your rehab starts to go over budget...

[Carlos Vega]

I bought my first property (duplex) back in June of '18 via the "House Hacking" Method Purchase price was 90k with an ARV of ~130k. My initial Rehab/ repair budget was 15k.

Goal was to get the work done and cash out refi or heloc, pay off rehab debt and to purchase another property by this summer '19 also by house hacking.

I'm currently  in it at 18k with about another 8k of work left. All 18k has been on %0 interest credit cards that start to come due March of 2020.

Total rehab is reaching 26k and Not much room left on the credit cards. Also my ARV isnt where I though it would be, now around 115k.

90k purchase + 26k rehab =116k

I'll essentially be getting back what I put in (fingers crossed), however Im lost on what move to make next and when to make it. 

If I try to refi or heloc now I know my appraisal is going to be low considering the work I still need to do, but I'm having a tough time coming up with the extra 8k to move forward on repairs which is unfortunately pushing me further away from the initial goal using a refi or heloc to pay off the rehab which I've financed on 0% interest cards. 

I know hard money is an option but it's a scary one. I'm also known for taking risks 😆

Any advice from the community is greatly appreciated. 

Just incase you were curious about the numbers:

My mortgage is $750.

Tenant pays $630 + gas, Electric, water and sewer

I pay trash and lawncare 

[Brian G.]

@Carlos Vega

Dude, you are so close! If you get a good portion/most of your initial capital back it's a win for your first property. You should definitely be strategizing with a mortgage broker in advance of your potential refi. If more credit is not an option currently, you might work some over time, rent out a room in your side of the duplex, pick up a side hustle to increase your income temporarily (deliver pizza?) or perhaps as a last resort borrow money from a trusted friend or family member who would want to help you out. If you do borrow from a friend or family member make paying them back your #1 priority after the refi. You can always pay minimum payments on your credit card until you personal loan is paid off and then aggressively pay down your CC before proceeding any further.