At that point, he won’t receive any further compensation, and I’ll seriously consider replacing him.By the way, do you have any recommendations for good eviction lawyers?"

It took me 11 years, 25 properties, and 76 doors just to replace my income.

Then I would speak with a land surveyor or civil engineer to get a sense of what it would take to obtain all the entitlements and bring in the utilities, etc.     

The modest cash flow could be reinvested, eventually allowing me to build a portfolio of income-generating properties.I recognize your point about needing $2.5M–$3M in cash to consistently replace a six-figure income.

However, this is not a cash out refi.Cash out refi is when you refinance an existing loan, with another one (i.e replace the loan) where there is enough money left over at the end of the process where you can put some proceeds in your pocket.When it comes to your strategy - just make sure you're being conservative with your numbers on the purchase / rehab if you don't plan on using other proceeds to payoff the HELOC. 

Of course when doing the 1031 exchange your basis will carry forward into your replacement property.Where you have a potential issue is establishing your intent to hold those properties but immediately selling one or more them as soon as you have them ready. 

Your reinvestment targets for a 1031 exchange would have you purchasing $700K of replacement real estate using all $500K of equity. 

Have you ever filled out an maintenance/cap ex spreadsheet with expected lifespan and expected replacement costs to try to accurately estimate sustained maintenance/cap ex.I already know you did not accurately project increased insurance costs. 

Let's clarify this real quick,I understand this model wouldn’t work for every property owner, especially those who are looking to sell outright and walk away from the property entirely, and the approach isn’t designed to replace a traditional property sale. 

This doesn't replace the need for a MSA that will capture additional clauses needed on a Contractor-SubContractor relationship, this is just a project specific form you would use in addition to the MSA (prepared by your Attorney):This template is for informational purposes only and does not constitute legal advice.