The title of this chapter sounds counterproductive. I know at this point I should be telling you to focus on success. Fear is okay. Keep going. Your vision of your rehab project will work as you planned it. Every key player will show up on time and preform. Your plan as written and re-written is final. Smooth sailing.
Nothing is further from the truth. Mistakes, setbacks, and failures are an unavoidable part of the rehab process. The most successful projects are the projects in which you learn. You will grow as a business owner from the beginning to the end of each project.
You have the unique opportunity to learn. The learning process will help manage expectations while moving forward. I have had many setbacks during my rehab career, which have had me scratching my head. Some of the setbacks will have you second guessing your decisions. Some will even have you ready to quit. Compose yourself and realize it is all par for the course.
Here are a few examples that I have experienced:
- Contractors–don’t show up as scheduled
- Constructions Liens-A contractor’s, or mechanics’, lien release is a form ssued when a laborer or supplier has been paid after they had placed a lien for a receivable that was conducted on a property. The lien was most likely filed after not being paid for some time by the real estate owner.
- Failed Inspections: City or State requirements
- Money–Change orders or cost to repair unforeseen items
- Unforeseen task – Items not seen until you begin to demo or uncover parts of the project.
- Settlement–Raising the money required for closing (acquisition)
Note: Lien Releases may vary from state to state. To reduce this setback, get every subcontractor and contractor to sign an agreement that he/she has been paid for service according to the contract. (Appendix B)