I had a contractor that I had to fire last month for a multitude of reasons (using my materials on his other job, extremely substandard work that has to be redone by someone else now, not paying his subs,  lying about work being completed that was not actually done, etc).

However, the total will be about 979k so need 500k (980k-479k) to pay off previous hard money and interest and then use the remaining 366k to finish the rehab which will be taken in draws from new lender

Also, if the tenets already pay for their own electric and gas can you use RUBS (if leagal) for water and sewer?

The $30,000 will just about cover the entire mini-split installation and at the end of it the well have fully separated heating that the residents can now pay for.

@Bruce Ng- thanks  1) are you planning to pay the seller the difference between the purchase price and the FHA loan amt ? 

I have been looking up a lot of properties in Northern Salt Lake County and Southern Davis County for a good move in and rent out other property and also a trailer to pay cash for to save money for down payment on a second place and etc.

We do mostly govt as they pay more and like clockwork, just screen property.

Sure you can go to higher loan to value but you will pay more in fees and have a higher rate for a relatively small amount of money.

They essentially want me to set everything up and pay the upfront costs, then they will transfer everything into their name and pay the ongoing fees throughout the lease.

The buyer had someone else pay more to build it than the value added, they had someone else do the associated work, they can get home purchase financing, they do not need to wait months for the ADU to be constructed.