This can be tricky from a warranty perspective as if one is the plumber and you have a massive leak it will be very difficult to determine which sub caused the damageNot to see it can't be done, but it should be at a considerable discount

This option comes with $0 doc/origination fee, though I do think there might be some third-party costs of $20 or so.

@Brian Larson or others....have you considered low-doc loans? 

As a contractor I always prefer a full gut but it does eat away the rehab cost and takes longer but no stress about plumbing, leaks, electric, lead paint and etc in the future.The patch up would cost less, fast timing, but then you are gambling with what's behind the wall and hoping nothing happens in the future.I assume most house that are purchase for BRRRR purpose are in distress/bad condition and old on some occasion.What rehab number would you go for?

Found a small leak in the celling.

These are coming in the 6-9% interest range.Another possibility will be an Non QM alt doc loan, but you will still have to prove qualifying income.

Lets do it together real quick:80K ARV20K Rehab50K PurchaseMoney borrowed=70K Time borrowed= 6 moHard money Costs=7K (10% of 70K: 2points on front 2 points on back, and 1% a month)Real Estate Commissions=8K (10% of 80K: 3% to listing agent, 3% to buyers agent, and 4% to title work, doc stamps etc)...so the flipper would take 6 months to lose 5K and you still havent gotten paid either...But wait, there's more: Upon further inspection the wholesaler's numbers were wrong anyway, the flip is going to take 32K and the ARV is really only 64K and I can only buy it for 12K (lets say 9K to the seller and 3K to you)12K + 32K = 44K Hard money costs 4.4K and closing costs 2.5K, RE commission is 4KTotal costs = $54,900Sale Price = $64,000Total Net to flipper= $9,100 Joseph, I am not necessarily a mentor, yet. haha but I would be willing to answer any of your questions. 

They are going to call and say there is a bedbug infestation, rats everywhere, no hot water, holes in the floor, the door won't lock, leaking roof, and the tub is cracked, oh, and the landlord refuses to fix all this.

I have bank records that show the routine deposits from each rental, I have tax docs that prove the income for the one property, I have lease agreements (though one is coming due), I have reserves built up... so I really think I have my bases covered.  

These are full doc / DTI quailifying loans.There is no regulation on doing a HELOC on out of state investment properties either as a TX resident.