I don't want to get into specifics but we passed on the property for a couple of reasons you mentioned.

Juan Mendoza International standards, Fannie Mae, FHA make no mention or requirement for a closet.

In the meantime, the funds have been reducing or suspending distributions to pay for value-add, cover increased costs, and to prepare for any required refinancing.So it will be a balancing act of dealing with the increased costs, managing refinancing, continuing to add value while waiting for valuations to rise significantly (partly from value-add, partly from lowered interest rates) before exiting.Disclaimer -- not advice, just some perspective on what's happening.  

@Karen SmithAs jay mentioned private lending has been around forever and it’s really not on the rise - I think it’s always been a large player in the real estate investment space for short term loans.

Not to mention what is your opportunity cost on that? 

The other option I have not seen mentioned yet is finding a corespondent who can originate for you.

You didn’t mention the property or deal specifics, but for many deals in the recent years, there have been amazing and unusual gains due to multiple unnatural circumstances.

It has been very challenging and the property sat for 3 months waiting for the claim to be processed.

Funny you should mention that.

The $1,500 net cash flow you mentioned represents a tightened rental return that could provide consistent passive income.