Instead, a lender will want to see that the property currently brings in (or has the potential to based on market rents) enough to cover the monthly principal, interest, taxes, insurance and HOA (if applicable).

One thing I’d be cautious about: if you’re doing this purely as an appreciation play.

Pick the kind of place to buy, like houses, buildings with many homes, or places for businesses, based on what you want, how much you can spend, and how much risk you can handle.

Please note, based on the numbers provided you will not be cash flowing. 154k loan amount - 30Y fixed  4k in annual taxes & Insurance 7.75% Rate Monthly PITI Payment = $1,436.60Your estimated rental income is only 1k-1.4k per month.

For instance, if you buy a cheap hot tub it will probably pay for itself if you get one or two bookings that you wouldn't have gotten otherwise and it will lead guests to choose your place even if they are not really going to use it

@Chris Hutchens based on previous comments it looks that you're looking to acquire long term rentals.

He was decidedly more excited about that idea.In terms of money, my initial thoughts were that the equity in the property would change over time as individuals contributed more throughout months/years until an agreed amount of parity was reached based on whatever the property called for: i.e. everyone owning a 2bed/2bath had contributed the same amount of capital, that sort of thing.

The issue that you have, is that your guests experience will depent greatly based on the demographic that the motel building brings.I would pass and try to get a small multi-family building or see if you can buy the whole motel(to have more control).

This is based on a few dozen private lender programs that I utilize for my clients.o Rate buydown ratio: Current norm is a 4:1 ratio, or 1% fee for 0.25% off of rate.

First, I am not an attorney and don't play one on television.A verbal agreement isn't worth the paper its not written on.