@Tina Rubin as an occasional lender myself, I think the second option (new deal/property) sounds a little cleaner and more of the traditional lending scenario - if I’m understanding you correctly.Just make sure you have a good understanding of the higher rate you’ll be paying to the HML and make sure you can still make your numbers work with that higher payment amount.A hard money lender’s main concerns will be the value of the collateral relative to the loan amount (LTV), and whether your estimate of the project cost is accurate.The HML will definitely want you to bring a substantial amount to the table as a down payment to keep their LTV low (65-70% is common), so if you need to refi your current property to get those funds then that might be something you’ll need to look into.If it was me I’d probably stick with a traditional fixed loan on the first property and start out with a private/hard money loan on the second, until it’s rehabbed and stabilized, and then refi out with another bank loan.

@Jillian EzMy CPA told me to talk to a real estate lawyer for the best answer, but offered this:“This depends on several factors including concerns for liability and budget.

It's hard to say what your wife's true underlying concerns may be.

@Wayne Brooks i understand your concerns, yet I have a a lot of friends that flip homes, friends whom placed the interest in me to do so.

On this place if you are really concerned about parties, I would not allow instant booking.

My only concern is that between the research I've done and the large amount of feedback and comments I've gotten from posts I've made in other forums/groups, the consensus has been that getting the appraisal changed by appealing or challenging it is less likely than hitting the lotto.

I’m not completely blind to other facets of the investment puzzle, but monthly cash flow is, by far, my primary concern and desire.

My concern is qualifying for loans with no W-2.  

The reason that is currently the condition is due to multiple offers and the listing agent/seller being concerned about the appraisal coming in lower than purchase price, which is mitigated by seller asking for no appraisal contingencies and larger amounts of money in the bank. 

What concerns me is the neighborhood.