If the floating rate debt starts costing too much and there is no capital to replace a rate cap, reserves run out.  

I recommend considering your cash flow and debt-to-income ratio before making a decision, and consulting with a financial advisor to tailor the choice to your specific needs.Good luck!

Hi Anthony, it sounds like you’re in a good position to start building your STR portfolio, especially with no debt, great credit, and rent-free living!

With 0% down and 30 year amortization, your monthly debt service will be $1756.

If you have the means to cover debt, you can avoid the accounts being liquidated.   

It's the concept of buying the debt attached to the mortgage rather than buying the house. 

DSCR loans go up to 80% of the purchase price and depending on the Debt Service Coverage Ratio and your credit score you can expect rates on a 30 yr loan ranging from High 6%- Mid 8%. 

The main reason I ask is because that is significantly below primary residence mortgage rates let alone any investment loans, if you can get rates like that I might need to make some changes on my end hahahTo answer your original question, assuming all else is equal long-term fixed rate debt is valuable. 

FHA is easier to qualify for and allows for higher debt to income.If you have not spoken to your lender already, you should also just look into the HomeStyle Renovation loan.

We have no debt and good credit scores, do we have any options for making this work?