However, it is important to note that if a leverage you're looking for doesn't qualify with DSCR, it means that your cash on cash return is negative (because it means your NOI or Rent is lower than rent -in most cases).So if you want to maximize leverage and are less cash flow sensitive (okay being negative), then conventional makes sense.

I plan on renting a unit and probably getting a roommate or two in my unit to maximize cash flow early on.

Quote from @John O'Leary: Hi Joe,We’ve worked with several PadSplit investors to secure financing, and while these properties cash flow really really well, they do come with challenges—tenant turnover/issues and being the biggest ones.One hurdle we’ve seen is that getting financing can be tricky since PadSplit rentals are still considered non-conforming by most lenders.

Purchase price: $45,000 Cash invested: $80,000 Sale price: $149,000 Purchased for $45k.

The 4-plex would produce around $1000/mo cash flow after financing, and that financing would recover your total build cost leaving you with no money in the deal at the end and an "infinite return" for CoC.

What is best for a newbie with little cash on hand?

We would like to create a partnership where we are 50/50 partners and he brings the cash and I bring the experience, knowledge, and contacts ect.

Purchase price: $169,000 Cash invested: $35,000 Looking to put 70K into the separate garage to make a 730Sqft home.

@Yooni ChoiFor a first property, $100/month in cash flow might not be ideal, but it’s acceptable, especially with a house hack.

Hey Jeff without knowing any details everything is what you are able negotiate. but you have to take in account the years interest rate and purchase price and what kind of cash flow.I will say get a mentor if you’re inexperienced these kind of deals can go left if you really have little knowledge when it comes to structure .