Run Into a Foundation Issue - Please Help

[Misael Herrera Granados]

My rental property is on it's first month of lease. I've spent close to $30k renovating it, and it looks great! Numbers are great too, as of now. However, an issue arose that I haven't had with the property until just this month. I believe the foundation just happened to hit its tipping point this month, so the basement has started to have water seep in through the cracks. The tenant is obviously not happy about this as the basement currently has carpet. I foresee having to redo the electrical system at some in the next five years, and that's something I was prepared for, but the foundation starting to leak is not something I was prepared for.

I am not in the financial position to do foundation repairs at the moment. I'm already paying off $16k of debt for the repairs on this house, and a foundation sump pump will add AT LEAST another $10k to that debt. If I were to take out that loan to fix the foundation, it would take most of the remaining cashflow away since I'm already using part of it to pay off the $16k. This would leave me with very little cashflow to replenish the reserves for this house.

My question and what I need guidance with is: Would it be best at this point to just sell the house and possibly break even, or should I take the loan and bear the next three to five years of paying it off? The reason I don't want to sell is that I've spent 15 months renovating this place, and my mortgage rate is 5%, an interest rate that is unlikely to happen again for many years. 

[Chris Seveney]

@Misael Herrera Granados

Is the water coming up through the floor or is it through the walls?

First you need to understand and analyze the situation. It’s rare for a home to not have a sump pump and then need one

Typically perimeter foundation drainage and grading (sloping towards house not away) are biggest issues with foundation leaks

Start with that and then determine cost.