Obviously lenders make most of their money off specific deep relationships (bigger flippers) than one off deals, however you can also imagine if a single operator gets burned out or is showing signs of being behind or giving excuses for other jobs (bad contractors, other delays), that they may want to risk their exposure because probably ALL or almost all of the 7-10 projects go south.

We paid off our home mortgage of 3.75% but so we could put a fat 1st Heloc on it and buy rentals quickly with cash at a discount.What's the plan when you pay it off?

Without knowing answers to those questions, if you can qualify for a refi that gets you close to breakeven, and you feel your market is healthy enough to appreciate to your original pro forma or better before you'd burn $60K then I'd just rent it out LTR. extra note: Each dollar of the $60K loss today worth more than each dollar of the cashflow loss in future years provided you obtain fixed financing until sale. 

You will probably never see a dime but at least it trashes their credit and may prevent them from burning another Landlord.

If it was to burn down and be a total loss I would not build on the lot and deploy the payout into another property.

My biggest problem was the time it took to take the property from burn-down shell to operational property was entirely too long, and I had too much of my own effort/energy into the project.

HOWEVER, we have been burned several times by borrowers who decide not to close literally on the day of closing.

When they get burned, by getting EXACTLY what they paid for, they post onine that all property management companies are terrible:(

I've noticed with many FSBO's that I've helped sell properties for in the past that they are usually a little burned out by potential buyers wanting to do multiple showings and or falling out of contract due to either financing or cold feet.

You can churn and burn tenets to bump rents at every available opportunity, but there will be more management, maintenance, and turnover - which often isn't worth it.