@Heidi Kenefick I have a horrible neighbor looking to turn me into to the city for anything.

It's almost like, you're paying at an 11.3% rate, which gets you a huge payment, but then, on top of that, you aren't even building equity at the rate that is in line with that horrible rate (even worse, basically).Of course, it sounds like you're working with a private lender, and it's a free market. 

I was able to get this horrible memory away from the seller and turn it into a positive for them.

The same factors that made this very unattractive to a single-family residential buyer (only SFH on the block, next door to a 3-story building, 4-5 doors down from a main transit way, house with a horrible layout) made it extremely attractive for a re-development.

This advice comes from a guy that ended up trapped upside down in a horrible investment (see my comment above about the 3rd property that I REALLY blew the budget on).Good luck!

I live in Milwaukee and it's a shame to see these situations and the families who are renting properties in horrible conditions.There are several upstanding investors that I know that have done city of Milwaukee rehabs using their funding incentives.

Most of the people were horrible.

Well say you did an excellent job and you got the second to agree to a short for $3K.Now review your numbers:A to B Purchase price $172K (1st)+ 3K(2nd) +2K (closing costs)= $177KNote: This purchase assumes there are no other liens, no arrears, no commissions, no HOA dues, and no pastdue taxes which is unlikely.B to C$195K (Sales Price) - $177K (Purchase Price) - $12K (Commissions) - $2K (closing costs) = $4K potential profit In my opinion, this is a horrible flip scenario and even if everything goes your way, you will not make any money.There are some other techniques: like a sub 2 where having 8 years spent on the first mortgage might have some value.

i always thought it can't be that horrible to rent properties if so many people are doing it.

You want to buy something that's crummy, but not horrible, and make it the nicest and best priced house in the area.