Purchase price: $100,000 Cash invested: $35,000 Single Family 3/1 with minimal attic space, only about 1400 useable sq ft. - Building up on the back half of the house, adding a full 2nd story with 8' ceilings throughout. - Project has been delayed due to Covid19 and Architect and GC issues, but we now have permits, and have started demo.

I tried both methods and HELOC was much better because the cost involved was minimal.

It's cash flowing a bit but with a lot of upsides and minimal risk.

It's cash flowing a bit but with a lot of upsides and minimal risk.

@Joseph Belgrad - credit inquires have a very minimal effect on your score (according to myfico it makes up less than 10% of the score) and that small amount is more than offset by having a proven history of paying XX amount of mortgages on time each and every month.My credit is being pulled routinely and I have not seen a negative impact on my score.

Another saver would be making sure you have minimized construction time- tub surround vs tile etc. 

The tax advantages with real estate are built in, and W2 income is minimized in saving on social security and Medicare taxes from not making rental income W2 income, according to my CPA.

So, I'm wondering if my recent credit issues will minimize my chances for an approval?

We want a magic pill because all the things that work well are boring and repetitive.

On the other hand, making value-add improvements like minimal exterior and interior changes to a Class B are relatively inexpensive.The modest returns of a Class A property with single-digit to low-teen internal rate of return (IRR) just isn’t enough when compared to the high-teen IRR results obtained when value-add is completed on Class B and C properties.