Own 2 SFH & Commerical property - but need help & ad

[Nancy Jenkins]

I own 2 SFH next to one another in multi-family zoning - about 2 1/2 acres combined. I purchased House A in 2004 for $94,000 with intentions to convert it to a daycare center. Net monthly profit from the center would be over $14,000 a month (35 children). I live in the home next door - House B. Bought it for $112,000. It has appreciated to $139,000. Comps on House A value it around $120,000.

My plan was to use the daycare center to generate great cash flow and to hold onto both properties to develop condos or apartments on the acreage later. Things were going great on House A renovation to daycare center, but in Nov. 2004 I was in a major traffic accident. In the hospital for a year, couldn't walk. By the grace of God, I was able to keep up the mortgages on both, but I could not afford to finish the renovation. My excess money went to medical bills, etc. I am working again, but I need between $14,000-$20,000 to finish the renovation. My contractor tells me it will take only a couple of weeks to complete. I have decided, if I can figure out how to raise the capital to finish the job, to have only a small number of children in the daycare (12) to start. Only one or two caretakers to manage. Monthly net will be around $2,000. This is after paying mortgage, salaries, everything. But another problem - I need to refinance this house. It was purchased w/an ARM loan. The house cannot be appraised as is - it is gutted. I need to do something right away. If I put it back together as a 3 bd 2 ba, then the refi should be easy. My credit is still good. I thought about using the appreciation to do the daycare conversion, but I am afraid the bank will call in the loan when they see it is in the middle of remodeling.

I also own 2 commercial lots in downtown Knoxville. A new $9 million Health Care Corporate building was just built right across the street from my lots. Both lots combined are not very big - 11,700 sq. ft. I bought one at a tax sale for only $2,500. The other I purchased from the owner next to mine. He knew he couldn't do anything with it, so he sold it to me for $2,000. I haven't paid for an appraisal on it, but I am told they are worth between $40,000-$60,000. I stuck a For Sale sign on the lots, but so far only 1 serious buyer. He pulled out when he couldn't get his money together. Does anyone have any advice for me? I would appreciate it very much.

Nancy