Heavy Mechanical Replacement & Architectural Roof Overhaul Fix & Flip

The Investor Scenario & Opportunity

An active real estate investor secured a single-family split-level property through a municipal tax foreclosure sale in Henrico County, Virginia. Situated in an established suburban neighborhood outside Richmond, the home occupied an attractive location near West End shopping corridors and major commuter highways.

The property had sat vacant for over four years, suffering from extensive roof deterioration, water damage, and unbankable utility infrastructure. The county tax sale required a non-negotiable cash settlement within five business days to clear municipal tax judgments and transfer title. The investor won the auction at $160,000. Comparable renovated homes in the surrounding Henrico sub-market featuring modernized mechanical systems were selling consistently near $335,000.

The Strategy & Capital Requirement

The primary challenge was rapid execution paired with capital preservation across concurrent projects. The municipal tax sale terms established a strict five business day funding window, with non-performance resulting in forfeiture of the earnest deposit and loss of the asset.

At the same time, the investor had working capital committed to an active renovation project in the Northside neighborhood of Richmond. To maintain adequate liquidity for trade contractor payroll and material deposits on that job site, the borrower required a direct loan facility covering 90% of the purchase price and 100% of the construction scope.

The Henry Solution (Loan Mechanics & Underwriting)

Hard Money Henry underwrote the transaction based on direct real estate equity and local Henrico County sales comparables. Our internal underwriting team evaluated recent suburban sales within 24 hours, completely eliminating third-party appraisal delays.

We issued a firm commitment letter and structured a $218,700 total loan facility, financing 90% of the purchase price ($144,000) and 100% of the renovation budget ($74,700). Construction funds were held in escrow and released across three structured draw inspections as work was completed. The transaction funded and closed in five business days.

The Financial Win & Outcome

The investor completed a 60-day targeted rehabilitation program. The primary value-add strategy focused on replacing damaged structural elements and replacing obsolete utility systems. The investor allocated $16,000 of the $74,700 budget to install a new architectural shingle roof with fresh plywood decking, and $26,000 to install a dual-zone high-efficiency heat pump, replace electrical wiring, and re-pipe internal plumbing lines.

The remaining $32,700 funded kitchen cabinetry, quartz countertops, modern bathroom finishes, durable vinyl plank flooring, and fresh interior paint. Replacing core mechanical systems and providing a new roof eliminated major buyer inspection obstacles, leading to a full-price purchase contract within eight days of listing.

• Purchase Price: $160,000
• Rehab Budget: $74,700 (Roof replacement, dual-zone heat pump, electrical/plumbing replacement, interior cosmetics)
• Financing & Holding Costs: $14,000
• Selling Costs (6%): $20,100
• Total Cost Basis & Expenses: $268,800
• Final Sale Price: $335,000
• Net Profit: $66,200

Key Takeaways for Local Investors

• Complete mechanical overhauls remove homebuyer hesitation. Installing brand-new HVAC systems and architectural roofs eliminates inspection contingencies and speeds up closing timelines.
• Tax foreclosure sales demand guaranteed funding speed. Partnering with a direct balance-sheet lender who guarantees settlement in five business days allows investors to win distressed municipal auctions.
• 100% construction debt preserves active cash flow. Structuring financing to cover total renovation draws maintains working capital reserves across concurrent development sites.

Planning a single-family fix and flip or suburban renovation in Henrico County or the Richmond area? Submit your property address at hardmoneyhenry.com/apply for a 24-hour commitment letter.