I agree with Dave Ramsey when he says that debt is a symptom of the real problem, which is your spending habits.

Other than it being really gross, it was already habitable.  70% ARV financed with a hard money lender.  

Definitely make sure you rectify any habitability issues first, as that can get you into some serious trouble in California.  

So they essentially financed a 17-unit property with only 4 livable units and no immediate plan to bring the remaining 13 units up to habitable standards.

You can't do anything to foresee that, but if their history shows numerous slow pays or other issues noted above, chances are they will fall into those habits again at the first sign of trouble, or, at least when Christmas rolls around again and they overspend!

Some policies will not pay out if they find out that the property was not habitable initially or if the work lasts longer than 30 days.

Most buyers, again most, look for solid comps to justify paying the price for a property.Both are important for any deal, but understanding the difference is VITAL!

I just wanted to start the new year out with some new goals, strategies, and habits.

I study the hell out of this business and study the approach and habits of the people who are successful at it, then try to model what they do.And my 2 cents (I'm a newbie, so take it w/a grain of salt) - you'll be fine doing a flip if you know something about rentals, b/c you already know the ins and outs of a second exit strategy!

And I just got habit that alway prepare for the worst , it might not happen , it might will , but that way I am ready and sleep better at night , Knowing i am prepared .