Mortgage or Free and Clear?

[Brady Hurs]

I am a beginner investor (0 properties) and I listen to a lot of podcasts. 

One thing I'm struggling with is whether or not to get a loan to buy property (that's called leverage, right?) or pay cash out right.

One side says pay in cash if you can.

The other side says don't ever buy all cash. Their reasoning was that lawyers foam at the mouth if a tenant gets hurt and YOU own it. They are less likely to go after you if the bank owns it. 

I've learned that if you put an LLC on the place, then you don't have to worry so much about that.

Is there a good cash/loan ratio to have?

Wanted to see what my BP buds have to say about it. 

Thanks in advance!

The Confused Beginner

[Paul Argenbright]

Just my opinion but if you have the cash to purchase a property free and clear than split it and do 2 or 3 properties with loans. Your payments would be low and your CASHFLOW high. Maybe even 15 year fixed if you really want to own them free and clear, and in 5 years you refinance and repeat. You could still do that with 30 year instead of a 15 your CASHFLOW would be higher with a 30 though. Example 100k house with 50k down and 50k mortgage is only 385/month on a 15 and 255/month with a 30. You then have twice the investments and double the CASHFLOW for the same amount of money.