What would you do?

[Connor Eigen]

Hi everyone, 

Im under contract for a STR and just got the loan estimate back. It was not what I was expecting. I was expecting to put 20% down and have an interest rate of about ~8%. Due to the appraisal of the house and the DCR being negative, my loan estimate is now 25% down and an interest rate of 10.5%!! My initial investment will be around 30k more than I calculated for.

I am using some cash and a HELOC to finance the purchase of this property. My worry is if the house doesn't perform like its supposed to. What would you guys do?

I estimate the house would gross ~60k. Heres the numbers on the house.

purchase price - 380k
loan amount - 285k

Interest rate - 10.5%
estimated expenses - 3.6k

Estimated monthly gross - 5k