You can use it for down payment and closing costs, but personally I'd rather have it on hand as a new flipper to pay for unexpected costs, cost overruns etc so that you don't get to the end of your project and find you don't have enough money to complete it.

I had to plat because I changed from a single family to a duplex (this was an unexpected expense).

Potential liability could come up in many unexpected ways, such as a trip-and-fall or a contractor injured while on the property.

This was definitely trying to force something that I really wanted to see work as it is in my hometown, but in the end, the numbers have to make sense.When I pursue my first flip, I will make sure the numbers make enough sense that it can get financed and there is plenty of margin in the deal to cover all unexpected expenses.  

And your investment has not produced cash flow for years.Would you just be delighted if someone fixed up the properties securing your loans?

We are now managing a 4 unit investment property in Oak Park IL for a family member.After their unexpected passing we found that there was a reverse mortgage on it.Property fair market value is about $335K with foreclosing Lenders estimate of $495K.The lender started foreclosure process, but we want to keep the property either to keep it as an investment property ($41.7K rent -$10K taxes -water), or sell in the future when prices pick up.With the current market we cant get a fair shake on the price, and we had some funny low ball offers from people/investors wanting to take advantage of the situation.We are looking to either partner with someone knowledgeable and split up the units and future rent profits, or loan $285,000 cash in exchange for a 30% percent stake of the home's future appreciation.What would be a better sounding offer to you as an investor?

Most of my rural experiences with contractors have been delightfully positive, however timetables are not the same.

I am aware that even with a contractor team, unexpected costs, and holding costs associated with it, will add up.After reading this site more and more, I am also learning about wholesaling and Tax Deed Sales.  

It sounds like I'm still within the limits of what lenders are looking for with my 45K, and that I had just been talking to lenders with really strict/unexpected limits.

@Sam Leon @Udayabagya HalimGood ideas to actually achieve the objective without being "intrusive".Have you ever found any totally unexpected surprises inside the properties from new tenants that looked good on paper after they have settled in for a couple of months?