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Updated almost 3 years ago on . Most recent reply
Use cash or finance???
Hey everyone!
I'm sure this isn't the first time this has been asked, but here it goes...
Is it better, or smarter to pay cash for a property, say $45,000.00, or just take out a mortgage and use someone else's money? I have been running the numbers and the cocroi varies greatly from one to the other. Any input? Again, sorry that this has probably been answered a thousand times before, I'm new into this and would really appreciate the help. Would it matter if I were using this as a fix and flip, short term rental, or long term rental? Do the same rules apply to each?
Most Popular Reply
#5 All Forums Contributor
- Plymouth, MI
As long as you have positive CF, it's always better to buy with a mortgage and minimal DP. The DP is what you are paying for the property...not the purchase price + interest. With positive CF, the tenant is paying the mortgage for you...which includes the balance of the purchase price after the DP. If you pay all cash, you are paying full price for the property.