You want an investment that pays for itself, including mortgage, taxes, insurance, maintenance, and even some money set aside for a reserve to cover vacancies and capital expenditures.

The interest rate is 7%, so we suggest this property is for someone who wants to get into Lease Options and meets the other requirements such as adequate reserves and credit.That means, they buy the property, they wind up with $50,000 in equity and they do a Lease Option to a buyer who doesn't currently own a house, but wants to.

FHA loans are a great way to get started with a small down payment, but make sure you have some reserves for things like repairs and vacancies.

I would just make sure you're saving for reserves and expect that first year to be really about learning the house.

Are you accounting for everything—taxes, property management, maintenance, insurance, reserves—and still hitting your target returns?

You must be patient and have some reserves if you are doing it full time.

I can’t imagine the returns you would have to generate. 22% federal tax, plus 8% state tax, plus 10% penalty.

The only downside of using a commercial line to try and match the AIO loan is that I have to manually move money into my line of credit(LOC) and sometimes ACH payments take 2-3 business days unless I wire it in and even that might be the very next day.I basically pay down my line with everything beyond my min reserves + savings.The advantage of the AIO is it automatically sweeps over your balance in your checking account (provided with the AIO loan) and pays down your loan with any idle cash each night at 12AM and calculates daily interest based on that reconciled balance.

Hi Trevor,I work at a local property management company based in Kissimmee and we are seeing quite a bit of STR convert to LTR because of the lack of reservations they had this past year.

This deal, i used my first successful buy and hold property and pulled a HELOC to secure financing and reserves.