short term strategy to get to a long term strategy

[Chris Simmons]

I turn 40 soon and want to go into real estate full time....sooner than later.  The good news is I have a nice paying job....the bad news is that it is a JOB.  I plan to start the process of becoming a Realtor and then plan on getting brokerage license with the thought being to manage rentals for others in the Tulsa area in addition to working with investors as needed.

I have 3 active rentals and am negotiating for 3 duplexes in a row near two of my rentals as well as another duplex that is going through short sale.  I self manage the rentals and work full time as does my wife.  I understand the value of leverage but am considering hanging it up for several years after I close on the 3 duplexes and possibly the short sale if that ever goes through.  We have two young boys and she is in grad school...another reason I want to get one big (to me) acquisition done and call it quits for a bit.

 Assuming I end up getting the 3 duplexes and go from 3 units to 9, is it dumb to consider just crashing debt with rental income and occasional capital contributions from our W2 income?  Or should I continue to look for long term fixed rate instruments to fully leverage these properties and just pocket the cash flow? 

The whole point of paying them off as much as possible as soon as possible is 1) help eliminate liability risk in the event the market changes, rent rolls decrease, W2 income disappears etc and 2) Be in a position where I can fully leverage them again in 4 - 7 years when I am ready to acquire another 4 - 10 duplexes, small apartment building etc and ditch the W2 for good.

For those that deal with rentals and used them as a way to ditch your 9-5, how did you do it?  Any regrets....lessons learned etc?  It is best to just do long term leverage and pocket the cash?  

I go back and forth between 30 year fixed mortgages that I could finance these with vs the typical 5 year balloon, 20 year amm institutional loans.  Again....long term, I want more.  Just not certain on the smartest way to get there.