Recently I was asked for a historical rent roll and we can't produce it - I can reconstruct by hand but very painful.

What you seem to want is some 5 step program to do a deal, you can wait for some nit wit to post that may tell you something you'd like to hear, but there is no such thing, sorry.So, you want to do brain surgery and you want some surgeon to give you pointers in a forum of what to avoid.

The insurance agent came back with a reconstruction cost of $167,300. 

I know a lot of older homes in my area that the county will not permit to renovate/reconstruct because its elevation is too low.Good luck!       

Because the asset is high quality and the borrower is a surgeon with 800,000 annula income the lender feels good about the lower net worth because their net worth is up-trending at a good pace.If however someone is worth 2 million but putting 1.5 million down and then has little ongoing other income to speak of it will be muhc harder to qualify for.

I now need to develope it and it is costing a little more than I thought due to the state DOT dumping a bunch of stormwater on it from 3 ditches for 1 mile each and 7 lanes of highway for 1 mile each.....this was not disclosed to me by the seller nor was there any easements for drainage recorded on this property when the highway was reconstructed 14 years ago adding these ditches and additional lanes of roads.Once it is developed to level buildable land, I will be selling the other piece for a decent profit but need to spend more than anticipated to take care of the drainage issues.  

If I'm looking at 5 deals, I'm less likely to "reach" on a deal like I did on this one. 4) Leave the heavy rehab and reconstruction to others.

The rules require something akin to a surgeon generals hazardous to your health warning that is such a turn off that no one responds.

Reaching out to insurance companies that pay for hotels for clients that have been displaced due to fire/water damage and reconstruction.3.

Purchasing the other house to demo and reconstruct an 8-10 unit MFR would generate much more income for the long run, but we would have to put in a large initial investment and take quite a hit in terms of time.My main concern is that I have interest in demolishing the house and creating a multi family residential, but we are totally new to this so I don't think it'll be a great idea.