The question my gap lender asked on site: where did the second bathroom go

Full gut on a 1920s four square, senior hard money loan covering purchase plus about 70 percent of the rehab number, and a gap position from a guy who does three or four of these a year in my market. He funded 90 thousand behind the first, second position, recorded, senior lender consented to it in writing because he's done deals with them before.

Scope creep is my whole personality at this point, so you know where this goes. The original scope had two full baths. Somewhere around week nine the plumbing on the second floor turned out to be running through a joist bay that had been notched to about an inch and a half of remaining material, and the correct answer was to move the whole stack. Moving the stack meant reworking the upstairs layout, and in the version of the layout that worked, the second bath became a three quarter bath and one of the bedrooms lost a closet.

I updated my own spreadsheet. I did not update the gap lender, because in my head he was a money guy and the money hadn't changed.

He showed up on a Tuesday. Suit, no hard hat, walked the second floor for maybe six minutes and then said, plainly, where's the second bathroom. Not angry. He'd read the scope in the file and he counted the rough-ins.

We stood in the hallway for twenty minutes while I explained the joist. He listened, asked what the comps looked like for two and a half baths versus two full, and then said the thing I've repeated to myself ever since: I'm behind 340 thousand of somebody else's money, so I need to hear about the change on the day you decide it, not the day I count rough-ins.

He funded my next one anyway. He also asked for a scope change notice clause in the note, which I deserved.