What would you do if you got someone to do it, gave the money they gave you to the seller as his/her earnest money, and the closing fell apart but the seller refused to return the money or tied it up in escrow or arbitration? 

Fix-and-flip projects can yield quick returns but require experience, while house hacking with FHA or conventional loans is a great way to get started.

Is it overkill for a potential non-problem?

Open to out of state investing, non real estate etc?

Can't you come together and figure out a solution where he returns and addresses your concerns and collects the $2K?

Personally I only use my HELOC on short term projects like flips, new builds and BRRRRs where I know I will be replacing the capital within months.You may be better off waiting a year and save up more cash or liquidate your index funds if the returns on a property will be better.

If they don't approve the project, all the time and money spent chasing it yields no return.3) Market Risk: The market can change during the entitlement process, which can also work in your favor like it did for many Developers in 2021.That's why knowing your municipality, understanding their processes, and making wise decisions in selecting which projects to pursue are crucial.Success in development requires choosing the right projects that 1) meet your criteria and 2) have a promising path to approval.The good thing is that this risk is compensated by having a higher return.

The IRS partially validated it by saying it is taxable, but they also tax illegal earnings.

If the property is in service then it’s reported on your 2024 tax return.

My specialty is working with investors and business owners in locating island based cash flowing rentals and or non rental second homes.