NOI Net Operating IncomeDSCR Debt Service Coverage RatioDE Ratio Debt to Equity Ratio.Scenario comparing use of COC vs ROI to evaluate performance of a potential investment:100,000 property purchased using Cash100,000 cash purchase.$12k per year in cash-flowCOC 12000/100,000=12% COCROI 12000/100,000=12% ROI100,000 property purchased using leverage (debt).  20,000 down, 80,000 financed. (400/mo payment)$7200 per year in cash-flow ROI 7200/100,000= 7.2% ROICOC 7,200/20,000=36% COC/CCRWhy does this matter? 

The problem is the lender is making us sign a form saying we will not occupy the property and that they can and will perform occupancy checks.

I know it’s possible to invest here in California but would you say I could stretch this amount of money farther in different locations?

I personally hold 5 CFD's with values in the low 30's but  valuations in excess of 70K on each property.The reason i like the CFD's are that in the event of default, as a general rule, you don't have to foreclose, just evict which is much lower cost and more important to me faster.If the borrower defaults and I have to foreclose, I can turn around and sell the property again at an updated price.Since i only paid in the high teens for each of the notes, the downside is something I can live with.BTW, all notes are fully performing and I'm getting an average yield of 28-32% and have about 250 payments left.Final comment.

All the flips we do with our clients, are pretty intense - adding GFA (gross floor area) through extensions, additional floors and / or full interior guts. 

While they perform great, most guests book rather last minute.

You could perform a walk through of how to prevent pipes from freezing on property and have them sign an addendum stating they have been informed and assume responsibility if pipes freeze within reason.

Had my real estate agent perform a video walk through for me since I was out of state and could not physically be there.

Had my real estate agent perform a video walk through for me since I was out of state and could not physically be there.

Hi Chihero,Don't forget the SEC requires the PPM to have a "Prior Performance in Raising Funds Table" and an "Operating Results of Prior Programs" table that all investors must be given.Also the SEC assumes Accredited Investors can handle losses if they occur and Sophisticated Investors can asses the risk for themselves.These opportunities are not open to the "General Public" for those reasons.