All Forum Posts by: Edward Heavrin

 The reason the cash on cash return is so good is because I’m not putting much down. $400/month cash flow  on a triplex isn’t that great in my opinion, but because I’m only putting down 10k to buy it, it’s a good return in that regard. If I had to put down the typical 25%, it would not be a good investment. This is why I’m asking the question to begin with. 

What are your thoughts on buying a property that has amazing cash on cash return (30-40%), but doesn't meet the 1-2% rule or any other rule for that matter. Basically, I can buy a Triplex with an FHA Loan at 3.5% down. Property is in pristine condition, so no rehab necessary. Because I'm only putting down around 10k, it makes the cash on cash return very appealing.

Is it ok to pay a bit more if the I'm getting it for practically nothing? It still cash flows about $400/month (after accounting for vacancy, cap ex, and other expenses) but the overall loan is a bit more than I'd typically go for. Thoughts? 

I think you did good. To cash flow 20k/yr with a 76k investment is over 25% cash on cash return. Well done! 

Is the 76k including the 40k in repairs?