So other things might make your case stronger such as your normal practice, the actual amount of crazy that you were offered, things like that.the second part of using the proceeds to buy vacant land is fine. 

Should I take this gamble?

I had 11 of these and good systems in place but still had 1-2 evictions a year and 3-4 big things that were normal annoyances like plumbing leaks, damages from hurricanes, or some vandalism.

Now that doesn't mean you won't be able to buy a normal duplex with 3.5% down that doesn't need any rehab.  

For example, a normal Hard Money Lender (HML) will lend us 70%-75% of a property's After Repair Value (ARV).  

The adjuster will differentiate between normal wear and tear and damage. 

I try to keep 6 months per property worth since that's normally what banks want.

Many people purchase the wrong properties and then can't afford repairs, vacancies and they don't have a clue regarding how to manage properties and don't have a clue regarding what to do when the tenant from hell destroys the property and does not pay rent for 6 to 9 months while you are paying the mortgage and an attorney.If you a gambling woman with huge suitcases full of money then jump right in and take your chances not with real estate, but take your chances trying to find an honest and competent person who will guide you in the right direction like you are their mother.

To your point, that is all lost income and not to mention you need to pay for any inspection past the 1st one (no clue how much section 8 inspections cost opposed to a normal inspection).

He clearly doesn't get investing or that refinancing after renovation is just a normal thing for many people.There is a reason that Fannie Mae allows up to 10 financed properties per borrower.Stephanie