I'm buying a foreclosure for $84K, ARV should be $125-$130K based on comps, maybe a little higher based on quality and condition. 3/2.5/2 1720 Sq Ft, 1988 construction.The loan package consists of a 6 month IO construction/rehab loan where they will loan me 75% of estimated ARV now, then refi into a 30 yr fixed when work is complete.The ARV is determined by the appraiser based on comps and based on a list of improvements that I intend to make.

I have good credit (but have a few loans) and I have the construction background to complete the majority of the fix up myself (the sweat equity).

I was a framer for 3 years and have been around construction one way or another

Why don't you try to be constructive instead of smearing companies and smearing fellow BP members who disagree with you.

Additionally the Army is cutting about $400 million in construction projects.http://www.reuters.com/article/2013/06/25/us-usa-army-idUSBRE95O1IR20130625 These cuts are spread out between 11 bases across the country; Joint Base Lewis-McChord in Washington, Fort Carson in Colorado, Fort Riley in Kansas, Fort Bliss and Fort Hood in Texas, Fort Polk in Louisiana, Fort Stewart in Georgia, Fort Campbell and Fort Knox in Kentucky, Fort Bragg in North Carolina and Fort Drum in New York.

If the yield is high like it would be with a flip or a new construction project then the difference in the leveraged state is VERY high.

My first house in 2005 was 5.75% new construction for an 80% 1st and 6.875% for a 15% 2nd and 5% down with no pmi.

BTW - we used to offer new-construction homes exclusively, but when the housing market "crashed", builders stopped building and new-construction dried up overnight.

Since you are doing some new construction - you also might enjoy this thread:http://www.biggerpockets.com/forums/48-general-real-estate-investing/topics/90068-diary-of-a-new-construction-projectAlso be sure to get some Keyword Alerts set up, perhaps for "new construction" or " Odessa" so you can jump into the conversations that matter to you!

I would like to buy it as-is, but potentially partner with the investor to provide construction financing to complete a 600 +/- addition to the rear of the structure that would have two or three bedrooms and at least one more bathroom.Here's my thinking:Prices have risen here about 30% since January 2012, so $110,000 + $33,000 = $143,000, but I don't want to pay the investor for the money he has shelled out for engineering and architecture work.