The renovation will cover the following:Kitchen - new floor, cabinets, appliances, paint, and remove a non-load bearing wall to open up the kitchen and living room.Living room - new floor and paint2 main bedrooms - new floor and paintMain bathroom - gut renovation, new floors, vanity, sink, showerBasement - convert portion of the basement into a 3rd bedroom with new sheetrock, paint, and flooring for finished part of basement and staircase, - wall off 2nd bathroom and gut renovatePurchase Price: $60,000Repair Cost: $30,000 (my own initial estimate came in around $25-30k so I am using 30k to be safer)ARV: $130,000Down Payment: $13,500 (15%)Hard Money Loan: $76,500 (85%)Monthly Expenses (6 Month, Interest Only Term):Interest: $825 (11%)Taxes: $220Insurance: $40Total Monthly Expenses: $1,085Total Expenses Over 6 Month Loan Term: $6,510Cash in the deal by the time of ReFi:Down Payment: $13,500Monthly Expenses for 6 Months: $6,510Purchase closing costs: $2,500Total Cash in Deal: $22,510Refinance:ReFi Loan: $97,500 (75% LTV)HML Payback: $76,500Closing Costs: $3,000"Profit" after ReFi: $18,000Equity after ReFi: $32,500Rental Income:Gross Income: $1,300/monthReFi Mortage Payment: $642/monthFixed Costs: $260/monthVariable Costs: $299/month (23%)Cashflow: $99/monthMy 2 exit strategies would be to simply flip the house, or, if the valuation comes in slightly lower than expected, I am confident I can still rent it at this price because it is a very rent heavy area compared to owning and continue with the BRRRR method with slightly better cashflow because of a slightly smaller ReFi loan amount. 

I like the numbers on the deal and I am in the process of locating a private investor to help with the down payment. 

Implement a thorough tenant screening process to minimize the risk of late payments or property damage.

In this case, more than others I feel in the area, the implication on the deal for the lender is not the region, but actually the method of acquisition.

Over the years I have had many tenants that have had to break their payments up into 2 or 3 payments, and they were tenants for 5-10+ years.

He then decided he money was worth more then the friendship and used the money as a down payment for his own house. 

Why not look at a few fix and flips to build up your down payment. 

Moldy smell was coming from clogged bathroom sink (I figure that out myself)Wow, I have had very similar experiences with tenants, and ultimately they were slow to pay and then would skip out on payment. 

You can make interest free payments from 6-12 months depending on how much you spend.

This requires that 75% of the rents cover the full mortgage payment.