Simply put, we start off with the As Repaired/Completed Value (ARV), then subtract from that number a reasonable profit, the rehab cost (scope of work), which we've gotten good at, a contingency reserve for any "unexpecteds", our cost of capital/carrying costs (interest and costs of the leverage used), and our costs/fees on the buy and sell sides of a flip.

I refinanced it into a  5% 30-year mortgage with a local bank as the seller would only carry the loan for a year.

Diversifying your portfolio can also be beneficial, as it helps mitigate risks associated with market fluctuations.

Starting with a single-family can be a great way to start especially if you’re looking for a lower-risk starter project where you can get your hands dirty and learn a ton by doing.

If they are the one providing most of the cash, they might not want to carry that liability, but you've already negotiated with your partners on this and then the bank isn't cool with it, you could be in a pickle.

If we can complete projects faster, we increase IRR and build trust.3) Market Risk- The longer it takes to complete a project, the more exposed you are to market fluctuations.This goes for all things Real Estate - BRRRRs, Flips, New Builds, Rehabs, etc.Real Estate is a wild ride I feel your pain, I've had this happen many times where the project is twice as long.

You open yourself to much more risk in not being able to finance out of it and being stuck with hard money and those fees/penalties.

@Jay StraderI'm wondering the same thing - I had an attorney review the contract & basically all it said was invest at your own risk.

I am here to create a business strategy that protects personal and business investments and mitigates risk,  procure a coach or mentor, and set up tax strategies to create long-term wealth for myself and my family. 

My current asset allocation based on age and risk tolerance not counting my primary residence is 70% stocks, 20% RE, 10% cash/bond type vehicles.