Worst case, they say no thanks and you keep looking.

Mistake #1 - I hired a friend as my contractor for my 203k project.

Due to a bad partnership with my then and current father-in-law (what a huge mistake) the few buy and hold properties we had were sold and I was gun shy on the business.  

Wells Fargo. did 2 through a local mortgage broker that was very flaky and we gave her several chances but had cut ties with her. too many mistakes. so we did 4th  through this current guy that I am dealing with now. 

However, worst case scenario should be the loss of your earnest money and not having to buy the home yourself.

Yes, it's a good rate, but you're too green to know what you're doing and it's harder to recover from mistakes if you're working with borrowed money.

Although I consider myself as a newbie in real estate, I am continuously acquiring wealth of information (also from few mistakes in the past) and so fortunate to have found BP. 

So I told him  " I will give you my normal price for 9 of the 10 , and the last one I will do for free . " As far as budgets go , they are only as good as the person preparing the budget , If that person is $ 4000 off on their estimation , then dont expect the contractor to make up for their mistake .

If the contractor walks off the job, it's more expensive to bring someone in to finish off a job that is half way through and you need to be prepared to do that in worst case scenario.  

Worst case the board does declne me - is my 200K gone in smoke?