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Updated about 12 years ago on . Most recent reply

User Stats

31
Posts
2
Votes
Vaishal Patel
  • Arkansas
2
Votes |
31
Posts

How does positive cash flow theory works?

Vaishal Patel
  • Arkansas
Posted

so i have read this on many websites that your property should be cash flow positive..now lets say i buy a house for 250k,i put 20% down and take mortgage loan on the other 80%.My monthly rent would be about 1800$ but my monthly expenses with mortgage,maintance,taxes,insuance etc would be 1900$ so that means i am making a negative cash flow of 100$...now instead of 20% ,i put 30% down which reduces my mortgage payment and thus reduces my expenses..lets say to 1750$...so now i am making 50$ positive cash flow....so how exactly do you determine if a property is cash flow positive..it seems like the more down payment you put the more cashflow you can get from the property...i am confused..?

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