.: Quote from @Jay Hinrichs: Quote from @Matthew Banks: Very interesting post John.

I am guessing they probably raised $15-25M from investors for the deal, so while the bank would still be covered investors would appear to collect maybe 10-20 cents on the dollar if they were to liquidate.if that's the case then I don't see buying one year really does anything unless I am missing something ? 

Any gurus willing to explain what is better and why?

The property is zoned as a SFR house and likely in a neighborhood of the same.Was the property not appraised by the bank when you got your mortgage?

Bank pushed us to 40% down payment so also executed a $85K seller carry-back loan to cross the finish line.

At it's basic level:Assumption: Asking the bank to turn the loan over to you and going through the normal underwriting process, credit, income, DTI ratio etc SubTo: Taking over the loan without telling the bank, no underwriting, no credit check, no income verificationBoth have risks, but it's not my intent to be detailed in this post.

That $250k sitting in the bank with no chance of vacancy or capex could earn you $11,250/yr at 4.5%. 

However, their lease is up in two months, so I would only focus on non-renewal for now.In my book, I explain methods for removing tenants without evicting them through court.

Realistically, one checking account and an accounting system will meet all your needs and keep your business better organized than 7+ bank accounts.If you want to collect bank interest from excess cash, add a savings account.

In theory it would be wonderful to get mortgages at 3.5% down and search for value-add deals to near break even on cashflow after year 1-2, banking on appreciation from a highly-leveraged investment in a growing economy.