If the General Partner commits fraud, the "bad boy" carve-outs in the loan would allow Freddie and Fannie to go after the KPs for any amounts lost. 

@Pierre Guirguis - I think it depends on how much of your existing capital is currently "tied up" in the BRRRR.

Have they committed to a test drive of the idea, even in one building? 

The real risk isn't buying a bad property — it's not knowing what you don't know.I'm glad I caught the IHA issue before committing.

Cash flow doesn’t exist independently — it’s the outcome of disciplined execution, realistic assumptions, and consistent operations over time.That’s why I believe the real asset in real estate investing isn’t the property.

Getting a new LLC is just not that hard, and its much cleaner than trying to add to your existing one, especially if they would have to buy in. 

i have been in a tough financial state starting 2025. i committed to a bad fix and flip and lost tens of thousands of dollars.

The right solution depends on the specific layout, travel distances, stair enclosure and rating, window size and sill height, and how the jurisdiction applies IBC and the NYS code for an additional dwelling unit in an existing building.Whether it is worth it comes down to a simple feasibility and ROI check, the all in cost and timeline to legalize, versus the increase in stabilized rent and appraised value.

Depending on the amount of the funds obtained at sale, there may not be enough funds to pay off all of the existing liens, and some may be wiped out without full payment.

Those titles are then recycled into bios, websites, and pitch decks to imply operating experience that does not exist.