The rental agreement is under-market rent for the area by ~$400/month and my strategy would be to implement a rental increase or end the current agreement with the proper 30+ day notice.

I would think a lease with option you may be able to implement this better without the liability risk.

I’m trying to implement the BRRR method and figuring things out. 

Eastern time on Friday, February 3, 2017, President Donald Trump signed a memorandum to roll back the Department of Labor’s fiduciary rule by asking the DOL to review the rule again and likely to delay its April 10th implementation (although at the time of this article a delay has not yet occurred but it is likely coming).

It was important for us to secure non-traditional lending that doesn't require such stringent construction requirements.

A couple different notes: We find highly stabilized properties where rentals are in high demand, we can implement RUBS or a flat rate utility bill back for common areas and utilities provided to the tenants.

Look forward to seeing what strategies you implement and hearing about your successes. 

Class B and C does incur more business plan implementation risk, which is one factor to consider.

Portfolio DSCR loans (this helps avoid the slower and more stringent traditional mortgage route)2.

Traditional banks are going to underwrite your property very conservatively and will want to ensure the property stands on its own before you implement any business plan, so make sure you understand the numbers.