There should be at least 100% of funding based on the amount in the reserve study and I always advise clients to contribute more if they can because unexpected problems always arise.

It would be devastating to overextend yourself and have the unexpected occur on FOUR projects, to the extent that you are unable to rent them and now you are stuck with four house payments, insurance, taxes, etc. and I assume you plan on having a primary residence, so five payments.

You never know what kind of unexpected expenses might pop up.

This was one of those unexpected costs that sucked away all of the potential cashflow to date.

Main components of rehab were:New windowsRefaced cabinetsNew rear doorNew french doorPaint interiorNew counter topsAll new floor coveringsUpdated all electrical finishesExterior paintedNew gutters (First time we used black and think it turned out really nice.)Graded a new gravel drive.This was the first time I attempted to use a GC.  

So with each component taken as a whole it ultimately impacts cash flow and how the deal is structured. 

You'd like have to pay depreciation recapture x3 years if you do rent it out.If you decide to rent longer than those 3 years, do you think the house will appreciate where the capital gain component is >15% (not the whole house, but just the capital gain component).

Vurtually every deal has some kind of wholesaler, cash for keys, unexpected rehab, whatever comes up, adapt and move forward.  

Closing costs, holding costs until you get a tenant on the other side, plus there's always going to be unexpected repairs or things you might want to do before they move in.

Non-Bank Mortgage Servicing Business Model Mortgage loan servicing is a critical component of the broader housing finance system.