Principal balance currently at 314kProperty Details: It's essentially a "2-in-1" property, with the main unit rented out for $1,900/month and an attached ADU bringing in an additional $1,200/month.

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).

If the permanent financing will allow you to recover most of your initial investment and the fair market rent covers the principal, interest taxes, and insurance with cash left over, you have a BRRRR.

I am using the tax benefit along with the principal pay down and appreciation to offset.

Financial freedom is all about buying and hold properties for the rest of your life - that's how you get appreciation, cash flow, principal paydown, and depreciation.

You'll want the rents to at least cover the monthly principal, interest, taxes and insurance (and HOA if there is one).

They have a balloon payment for the principal due in 10 years.

Lease Terms: Determine a monthly rent payment that covers the HELOC repayment (interest and principal) while providing some positive cash flow for you.                    

You're paying yourself back interest, the principal is out of the market and not going down, AND you're using the funds to build equity in real estate.

Wealth-drivers are appreciation, debt pay-down (ie. principal payments) and tax shielding.