Structural Disaster on an Occupied Rental: Building a Cheaper Fix

TLDR

Foundation concerns blocked the planned refinance. Ross and the engineer developed a cheaper interior beam-and-pier plan, but water and incomplete contractor work delayed it. The video ends with Ross withholding payment again; it does not show a completed repair, engineer letter, appraisal, or refinance.

Table of Contents

• The BRRRR Math That Got Stuck
• When the Engineer’s Plan Is Too Expensive
• A Cheaper Plan the Engineer Reviewed
• The Flood That Proved the Rule
• Three Steps in Order: Bleeding, Structure, Cosmetic
• Setting Expectations Like You Mean It
• FAQ

The BRRRR Math That Got Stuck

The whole game with a buy-rehab-rent-refinance rental is the exit. You buy it for roughly $120,000. You put about $40,000 into it, all in. That includes the renovation, appraisal fees, closing costs, utilities, insurance, the boring bucket.

Total in: around $160,000.

A tenant moves in. Rent starts. You go to the bank and ask for a new loan on the stabilized property. They send an appraiser. You are hoping for $200,000. The bank lends 80 percent of appraised value, which is $160,000, right at your all-in cost.

That is the BRRRR. The bank buys the house from you on paper, pays off whatever you used to buy it, and you end up with a cash-flowing rental and your original capital back to redeploy.

The call comes in. The appraisal failed. Structural issues.

In this case, the bank would not complete the appraisal path because of the structural issue. The transcript does not generalize that result to every plumbing, electrical, or roofing defect.

No appraisal, no refi. No refi, no capital back. No capital back, no next deal.

When the Engineer’s Plan Is Too Expensive

The bank wants a letter from a structural engineer that says the house is sound. The engineer inspects the crawl space and sends his plan.

His plan is to hold up the house on jacks, remove the entire existing foundation, pour a new footing, and build a new foundation underneath. That is the textbook answer. Open the code book and that is what it tells you.

The problem is the textbook answer costs more than I paid for the house.

Here is the thing most people miss about a structural engineer. By default, he is going to look at the code book and design a solution to code. What you are actually hiring him for is not to read the code book to you. You are hiring him to look at the principles behind the code, understand your financial constraints, and work with you on a custom plan that gets the house to a safe standard without rebuilding the whole world.

That is not always possible. Sometimes the damage is so bad the textbook answer is the only answer. But before I accepted a build that cost more than the asset, I was going to do my own investigation and come back with a proposal.

Pro Tip

Before accepting a plan that costs more than the asset, Ross looks for a sound option to take back to the engineer. That is not always possible. The engineer, not the budget, decides what can be approved safely.

A Cheaper Plan the Engineer Reviewed

I sent one of my guys under the house to film every inch. Then I sat down with the footage and designed a different fix.

The original exterior foundation walls were cracked and failing. The new plan does not try to repair them. It leaves them in place and treats them as a weather wall only. No structural load.

Inside those walls, we build a new structural system:

1. A new beam runs the perimeter of the house, just inside the existing foundation walls.
2. We modify the floor system to tie into the new perimeter beam, extending joists outward to attach them to the new structure.
3. Block piers sit on new footings under each beam.
4. The new footings and piers do all the load-bearing work from here forward.

The old foundation walls keep the weather out. The new interior foundation holds the house up.

The engineer reviewed the idea. He worked out the beam sizes, pier spacing, and footing specs, then signed off. That is how you work together. You do not fight him. You offer a sound option for his review.

The reviewed alternative left the old walls as a weather barrier and created a new load path inside them.

The Flood That Proved the Rule

There is a catch. A tenant was living in the house. We could not displace them. That meant we could not cut the floors open from above, which is the easy way to pour new piers and beams. We had to work from the crawl space only.

My crew suited up, rigged a concrete mixer outside, and started rolling five-gallon buckets of concrete through a cut in the wall into the crawl space. Then it rained. Then it rained again. Then it rained a third day in a row. The crawl space flooded.

Inches of water in the back yard. Inches of water in the crawl space. The repair job was sitting in a puddle.

That is when I realized the mistake. I had not stopped the bleeding before starting the repair. Water was still getting under the house through a combination of negative grade and an incomplete gutter system. We were trying to pour new foundations into a swamp.

The Biggest Dumb Mistake

Skipping step one. Ross’s point is that piers and footings set in soil that stays wet can sink, so the water source has to be addressed before completing the foundation repair.

The crew stopped and built out the gutter system, running buried piping through the back yard to discharge away from the house. The yard still had negative grade, but Ross says it was not severe enough to justify a retaining wall, so the piping was the chosen control. Only then could the structural work restart.

Three Steps in Order: Bleeding, Structure, Cosmetic

Every structural issue follows the same three-step sequence:

1. Stop the bleeding. Usually water intrusion. Sometimes termites or other wood-destroying insects.
2. Do the structural repair.
3. Cosmetic.

Go out of order and the repair is still exposed to the active problem. Ross’s warning in this case was that piers and footings can sink when the surrounding soil stays wet.

Water defense stack, from outside to inside:

For a negative-grade site, Ross described a retaining wall with a French drain as one possible control. Water hits the wall, drops into the drain, and gets routed around the house. His own property did not need that system; he used connected gutter piping instead.

Ross’s sequence is to fix the active moisture source before finishing the repair and finish work. The right design still depends on the site and the qualified people on the job.

Setting Expectations Like You Mean It

I sent the repair to a subcontractor. My own crew dug the footings to the engineered size, depth, and locations so Ross could verify them, then a lower-cost subcontractor came in for the block piers and beams. The split was about control and cost; the source does not claim a ten-minute check prevented weeks of rework.

The sub sent me photos asking for payment. The photos showed a single row of stacked blocks, no mortar, sitting on the new footing. The scope of work said two rows of blocks, mortared, with specific beam connections. The photos showed none of that.

Do Not Pay for This

Ross withheld this payment request because the specified work was not complete. Document the mismatch and apply the payment terms in the actual agreement.

I met the sub on site. Expectations get delivered three ways:

1. Written. Text or email so there is a record.
2. Verbal. In person at the job site, walking through the work.
3. Media. Photos or video showing exactly what the finished product should look like.

I showed him the footings needed to be wider. Two rows of block, mortared. Specific header sizes. Exact spacing between connection points. Shims between the pier top and the beam bottom in pressure-treated wood, because anything touching masonry needs to be pressure-treated.

Ross also asks for a photo when a contractor buys materials. In this job it exposed non-pressure-treated lumber and regular nails where his approved specification called for pressure-treated lumber and galvanized fasteners.

The later photos still showed unmortared block and non-pressure-treated entryway lumber. Ross held payment again. That is where the video ends; it does not show a corrected third round.

Was that contractor bad? No. He is actually one of the best I work with. He was juggling multiple jobs, communicating through a project manager who did not fully understand the spec, and working through people on his team who did not have my context. That is normal. That is what real construction looks like.

Ross’s project rule is ruthless accountability to expectations. It comes with a harder question: did he make those expectations clear in writing, in person, and through media? In the video he still asks that question while refusing to call incomplete work done.

FAQ

Can I negotiate with a structural engineer on a cheaper plan?

You can investigate and present an alternative for review, as Ross did. The engineer must decide whether it satisfies the structural requirements; the transcript does not promise approval or prescribe shopping for a different answer.

What should I do if the appraiser flags structural issues I did not see?

In this case, the bank wanted a structural engineer’s letter before moving forward. Ross hired the engineer, compared the first plan with the asset value, and had the engineer review the alternative. A different lender or defect may require a different process.

Can I do BRRRR on a house with known structural problems?

This case shows that the refinance can stall until the concern is resolved. It does not establish a blanket yes or no; the engineer-approved scope, lender requirements, occupancy, budget, and contingency all have to work.

Should I withhold all of a contractor’s payment if part of the work is wrong?

Ross refused the payment request because the specified work was not complete. The transcript does not interpret another contract, lien law, or partial-payment obligation; document the mismatch and follow the actual agreement and local law.

Is DIY structural work ever a good idea?

This was not an unengineered DIY repair. An engineer approved the design and specified the beams, piers, and footings; Ross used his own crew and a subcontractor to execute it. The source does not give beginners permission to design or build load-bearing work themselves.