Let me illustrate with an example.One property I looked at is 105k.  

Financial Benefits are (illustrative): - $40k appreciation-  $3k per year in tax avoidance (interest write-off)The income (puts money in your pocket) comes in the 10th year vs. monthly.  

You partly here illustrate why the lower class properties with higher cap rates actually under perform the higher class properties with lower cap rates in reality.

Wow, @Brandon Hall, thanks for telling this story, which perfectly illustrates the kinds of problems DC law creates for landlords.

Don't take the seller's cap rate at face value and always make your own calculation.I believe that @Bob Bowling was using the cap rate to illustrate a different point.

Or is the situation you use to illustrate something that is becoming more and more common? 

Disclosure:This above is for information and illustrative purposes only and is not, and should not be regarded as investment advice or as a recommendation regarding any particular security or course of action.

If the LLC is the owner of the property and the mortgagor (borrower), none of that changes - only membership in the LLC.David J Dachtera Well, the argument the bank would make (playing devil's advocate here for a second) is that a change in ownership of an LLC may illustrate a degree of instability for the current ownership structure of the secured note.

(Totally bogus numbers, just for an illustration.)Now your syndication does a cost segregation study which produces a $2M first year bonus depreciation.

The subtle humor of this obviously metaphorical reference to a ship capsizing illustrated my concern about the impact of the planned military buildup on this small tropical island."