It is where cash goes to die, where the maximum return it earns is the prevailing interest rate.

Cash flow in Norcal is hard to find unless you are paying cash, then COC returns are paltry.  

The property would then be owned by the IRA and all expenses would be paid from the IRA; all income generated would return to the IRA.

@Michael StanleyDepends on your price range and what you want in return.

The investment ratio should be maintained to ensure that each member is receiving its proper share of investment returns.

If it gives you good cash on cash returns, consider offering more and accept you can't refinance all your money out. 

Hello,Can anyone explain to me in what scenario would you use cash on cash return vs cap rate. 

This is in a new area, new agent, new contractor, new property manager.The returns would be over the 2% rule. 

@David HarleyIt is hard to opine on this without the context of market and property class/condition, but what I notice from the analysis is the CoC relative to loan amortization:  For a 25 year loan and $28k cash investment, demanding a return greater than 14% may be in your best interest.  

In return he wants a 50/50 split and wants me to convince the seller to "carry-back" 40% and not the current 70%...