I'm talking all in: Down Payment, Inspection, Closing, Rehab - everything.

Best practice is to keep one or two payments in reserve from the buyers down payment for such instances.

In short, I can afford the additional $1100/mo cost of a second house, even until I rent it out.I have around $35K in HYSA and emergency funds that I could use for a down payment, but that's less than 20% which would be required for a conventional loan, assuming full purchase price.

If you have extra cash at the end of the month, then do double up payments on the mortgages so the principle is reduced and this will increase your heloc room.

I had a chat with them on the phone as i was curious about the funding.. but came to the conclusion that the down payment ( the client made to buy) was probably what they paid for the property and the seller carry back note was the profit.. and then the seller carry back note is sold to yet another investor.. who is investing for coupon money.   

I do direct booking through the Houfy website, taking credit card payment by Square. 

In our opinion, Class C tenants have FICO scores from 560 to 620 - where their chance of default/nonpayment is 15-22%.

I’m a fan of harvesting the equity to buy more and more cash flowing properties with zero out of pocket cash for down payments.

@Jonathan SniderFannie and Freddie do have LLPA's and the lower the down payment, the higher the cost.

In this type of situation, they want low interest rate with low down payment also.