But this illustrates that sometimes trying to save 1% on the cost of something can lead to dramatically different outcomes.

Meanwhile your peers who own $100K houses in Detroit (no knock on Detroit, just used for illustration purposes) feel the need to create a convoluted web of entities and ignore most of what I shared.

I've included an example below to help illustrate this.So different lenders have different rates (which do vary even for DSCR loans) but these are factors they all consider.See example below:DSCR < 1Principal + Interest = $1,700Taxes = $350, Insurance = $100, Association Dues = $50Total PITIA = $2200Rent = $2000DSCR = Rent/PITIA = 2000/2200 = 0.91Since the DSCR is 0.91, we know the expenses are greater than the income of the property.DSCR >1Principal + Interest = $1,500Taxes = $250, Insurance = $100, Association Dues = $25Total PITIA = $1875 Rent = $2300DSCR = Rent/PITIA = 2300/1875 = 1.23If a purchase, you also generally need reserves / savings to show you have 3-6 month payments of PITIA (principal / interest (mortgage payment), property taxes and insurance and HOA (if applicable).

That is most definitely the exception and not the norm, but I say that just to illustrate the point that the deals are still happening in this market ~ Advice: Pick a market.

@Eduard Gibert RenartBecause on a note you are getting principal and interest back and it’s hard to reinvest a very low payment.What you are also missing is the tax consequences in these situations which can have major impactsI did a post on this In tax liens advising where 8% is far better than 10% and illustrated this example.

Yet lending all your money in second position is like buying a ticking time bomb without knowing when it will go off.Where I disagree with you is that adding “3-5% higher (min)” to a 13% second position loan somehow mitigates the risk (and I know your numbers were made up for illustration).

But this:...I am not sure the barrier you feel exists is as great as you perceive, or possibly doesn't exist at all. . . . and that the only person who voted it up was also male, just illustrates the need for this group even more.  

To illustrate the other side, the rest of the island (outside of these resort zones) has historically been a place where owners can only do MTR's - 30 day + stays, but new legislation just got passed and it's looking like a minimum 90 day stay will be required.

It is NOT safe to do so.Funny story to illustrate: over a decade ago we took over a property with a senior citizen.

This criteria is for 1-4 and 5-8 unit programs.I've included an example below to help illustrate this.So different lenders have different rates (which do vary even for DSCR loans) but these are factors they all consider.See example below:DSCR < 1Principal + Interest = $1,700Taxes = $350, Insurance = $100, Association Dues = $50Total PITIA = $2200Rent = $2000DSCR = Rent/PITIA = 2000/2200 = 0.91Since the DSCR is 0.91, we know the expenses are greater than the income of the property.DSCR >1Principal + Interest = $1,500Taxes = $250, Insurance = $100, Association Dues = $25Total PITIA = $1875 Rent = $2300DSCR = Rent/PITIA = 2300/1875 = 1.23If a purchase, you also generally need reserves / savings to show you have 3-6 month payments of PITIA (principal / interest (mortgage payment), property taxes and insurance and HOA (if applicable).