Should I invest in SFH using commercial lending?

[Rachel Smith]

Hi All!

I am looking to close on my first deal in the next 2-3 months and could use some advice about how to continue to build my portfolio from there. 

Situation:

*I don't qualify for a conventional mortgage because I'm am an independent contractor with only 6mo of history *no co-borrower at the moment *100k available, good credit score, and weak income/W2 history 

1st deal criteria: *Fayetteville, NC market* CASH purchase and reno, SFH for 50-70k, complete a 10-20k reno, for an expected ARV of 100-130K, rent $800-1000 (~1.2%)

Question:

Should I use commercial lending (long term, fixed) to pull my cash out of the deal so I can continue to grow my portfolio? The lenders I have spoken with say that rates would be around 6.5%, which would make it difficult to find residential deals that would have strong cashflow after the refinance. I would also only be able to do one deal every six months with this strategy. (If I want to get money back before six months I could only get up to 80% of the purchase price)

I am very new to RE and the world of creative financing. I would greatly appreciate any and all advice or suggestions of a different angle to approach growing my portfolio.

Thanks! 

Additional context if interested: My goal is to create a portfolio with $1500 monthly CF in 2 years. I could refinance the commercial loans in a year and a half when I qualify for conventional mortgages (bring CF up to ~$200/door).  But I would still not reach my goal if I can only buy 2 properties a year.