Help with getting started!! $100k

[Lon Coleman]

All, 

I am just getting started, my plan was Buy and Hold rentals...I am looking for cash flow but I am wondering if that is the best option for me. I have secured about $100k of financing at 0% for 12-24 months. So this will need to be paid back in some fashion. What is the best option for me to get started? Multi-family where the cash flow is more? I was against the Fix and Flip, but might make sense to use the $100k to generate profits from fix and flip "step 1" and use the profits for rentals in "step 2". What about 20% down on 5 houses and refi... I still think the mortgages eats all my cash flow... even on a 17% Net ROI property.

I am stuck and could use some guidance. 

[Jonathan Taylor Smith]

@Lon Coleman - YES, having a mortgage does put a damper on cash-flow... The bank makes more per month than you do for the first several years, which is just one of many reasons why Buy & Hold Rentals is a long term play. If you essentially have a FREE $100K for up to 2 years, I would use the BRRRR method.

"20% down on 5 houses and refi" will be more like 20% down plus closing and holding costs on 4 houses (3 or 2 if rehab is also needed and you keep sufficient reserves). But in any case, once you get the house rented, since you are essentially using cash, you can use "Delayed Financing" to drop a mortgage on the property and pull all the cash back out almost immediately. You could repeat that over the 2 year period almost as fast as you can find suitable properties.

Then after maybe a year or so you can refi again at 75% LTV if the ARV and rents are high enough to support it (and you don't mind paying closing costs again), possibly even pulling out created cash profit. True, your cash-flow will be lessor, but if done right (and a little good fortune), you could easily end up with double digit properties and an extra $100K or so in hand by the end of the 2 years.