This will reduce your risk and cash invested and if something goes wrong you wont be bled dry with never ending repairs.

Quote from @Ricardo Polanco: Good evening everyone, I am evaluating the possibility of buying a multifamily property in Scranton, at this moment it has 2 apartments that only need cosmetic repairs and it has a big 2nd floor unit that needs a full repair.

Expenses incurred before the property is in service are considered capital expenditures and must be added to the property’s basis rather than deducted immediately.This means costs like rehab expenses, repairs, and other improvements made before the property is ready to rent are added to the property’s purchase price and can be depreciated over time once the property is in service.

I'm SURE you mis-spoke and meant to say, he's a close friend that I am trying to help but it was not my intention to "fix his credit".Debt Relief and Credit Repair Scams"The FTC has brought scores of law enforcement actions against these bogus credit-related services, and the agency has partnered with the states to bring hundreds of additional lawsuits"SOME CASEShttps://www.ftc.gov/news-events/topics/consumer-finance/debt...Financial Education Services (August 5, 2024 )Panda Benefit Services, LLC., FTC v.

This ensures you have a clear picture of what repairs are needed and helps avoid surprises during the rehab.

I would definitely factor in some substantial capex/ maintenance and repair costs which could lower your returns.  

Nothing to get crazy about but no need to deal with tenants, property taxes, repairs, vacancies, etc. just sit back and collect.

I bought 1 House out right, I am refinancing for 100k. had 1 renter paying 1000. using the refinance to purchase the second property, and putting renter for 1400. it will also need 25k in repairs.

During times of uncertainty, lenders stop lending, or they increase underwriting requirements, or the property hasn't gotten to the "repair & rehab phase" and isn't "lendable" and so on and the DOS is called.

He missed significant repairs that turned a $10,000 refresh into a $60,000, 8 month rehab.