When are you overleveraged?

[Jill F.]

I'm just curious as to how other people define 'overleveraged'? How much leverage is too much? I would be afraid to have a balloon loan or a one year arm. I would be afraid to use hard money. But I do have a 20 year arm adjustable every 5 years and cross-collateralized properties-- I know that's a deal killer for some folks.

I have reserves such that I could run for probably a year with no rent revenue at all (but it would hurt), a decade with 30% revenue and indefinitely at 50% (GPR) revenue which is a little over break even for us. We currently have more than 25% overall equity in our portfolio and I'm still nervous with what looks like a serious recession looming.

Where is your line?