Funding draws and line items
Closed on a deal at $190K duplex, appraised at $285K, with an ARV around $385K. Rehab will be funded through draws, but I don't have all the upfront cash. I've got about $33K available on business LOCs/cards and another 15k in personal LOC. Where i am getting nervous is that i beleive i bidded it correctly in total but on the scope of work aligned it incorrectly per item. Example: i put 28k for both units but im sure it's 20-25k for each. Total rehab budget approved 75k. It is however enough for each unit and exterior but the scope line items per cost may be misaligned. Hoping they don't decline a line item upon completion(s). Learning lesson here.
Question: how do you all keep projects moving between draws? Do you float with credit, private money, or negotiate with contractors? Also any info about the line items would help.
Most Popular Reply
Don't float with private money. Just use cash or personal LOCs. Or work it out with your contractors to get paid when the draw is released and only cover materials.