Had I gone to the city, I would have known that the house was built without a permit, and that to be able to renovate the house I would have to appear before the board of adjustment of the city.6) Most importantly, the current New Western business model does not afford new investors time to do their due diligence on a house.

The seller agreed to lower the purchase price and adjusting closing costs to avoid any wash.  

This is particularly important in competitive markets where speed can be a key factor.Risk Management: While there is certainly risk with any form of financing, careful management and choosing the right lender can mitigate these risks.

The added rate adjustments of the term and IO period usually negate the benefits (or many of them). 

If your focus is on speed, (e.g. because the seller dosn´t want to wait or give a financing contingency) you might consider a hard/private money loan, since they usually can close way faster than a conventional bank loan.

Plus they adjust based on sales and not for a little while i noticed.

When the adjuster finally shows up, he/she will be able to give an estimate to fix the damage and what the insurance will pay - minus the deductible.  

@Tatyana Sherban Considerations are speed, imterest rate and other terms, hassle and complexty of getting loan, and in some cases probablity of getting loan. 

In a 3/2 you are going to want a king in the master bedroom.You can make some adjustments with the other 2.

Your depreciable basis at the date of conversion is the lesser of (1) Adjusted basis (cost + improvements) or (2) Fair market value.