The reason people seek for distress properties, so that they can acquire the property at a low price and renovate the house aka "value add" so that they can increase the property's value and create sweat equity, then pulling the money out or cash out we call out so that investors can liquidate their money and reinvest on the next project @Albert Bui @Carlos Valencia

This holistic approach to portfolio management can yield massive advantages in terms of efficiency and financial leverage.Furthermore, the liability shield provided by this structure could prove extremely advantageous.

I might add, I would also check the track record on completed projects (specifically the type of projects you are interested in funding).

I would have paid $100k because the massive and never-ending value that community/family gives is incredible to say the least.

A contractor isnt there to finance the customers project . 

It is a massive community with PMLs and like minded folks who are doing deals together.

The problem:  I'm on contractor #10 in Southern CA and so far nobody wants to quote the project!!

I have made a Bridge Loan to them on their Pueblo Springs Apartment project--they are passed due in paying off the loan and are not responsive with information to resolve that situation.

I funded a 80 lot project there a few years back and my client flipped to DR and did quite well.

If you bought an existing home and it had a massive problem your inspector didn't catch, your deal could go under.Am I wrong to think about it this way?