In this case, your monthly payment with 20% down will have a good MARKET rate if your DTI works with a much lower month payment and no mortgage insurance(MI).

However, they approach financial health from different angles.The 50% Rule is a quick estimate that suggests operating expenses (excluding mortgage principal and interest) will roughly equal 50% of the property's gross income.The DSCR is a more precise calculation (Net Operating Income / Total Debt Service) that determines if a property generates enough income to cover its debt obligations.Deal example:- Class C middle class neighborhood- 4bd / 2ba single family house- ARV: 190k- Purchase: 105k- Rehab: 35k- Market rent: $1,400-1,525- Section 8: $1,475- Property manager: 10%- Taxes: 125 month- Insurance $1250 yr- HOA: $55 month- purchased and rehabbed with all cash.

I then went to the bank and mortgaged it for the same $30k at 8.5% over 20 years.

Instead of paying down someone else’s mortgage, you’re setting yourself up for bigger and better deals down the road.Your first deal is going to depend on a lot of factors—how important is location?

Mortgage lenders will qualify you for a higher purchase amount for multis than they would on a single, because they will count the rent you will be making on the other units as additional qualifying income for your loan application.

For now, it Looks like your roommate/tenant can cover half of your mortgage (plus hoa fees). 

Second pro is that you get to lower your living expenses or live "rent free" by having your tenants pay for your mortgage payment.

Have a 27k mortgage balance, sale price est at 415k.

Other than that, it is really a light doc loan with not many strings attached compared to a conventional mortgage.

Any other expenses are using up funds that would otherwise be sitting in your checking account to make a mortgage payment with.