The issue is that after a high LTV refinance to extract the value add, the property is large cash flow negative.  

Only negative

Then refi into DSCR using appraisal market rent (I have program if cash flow is negative, not worried about that) and then after the DSCR loan closes, then they put up the walls to make it padsplit.

HOA's can be a negative so be sure to check the HOA regulations to see if they have any rules around 30+ day stays.

Also, focus on 2 years of job/income stability.Class D Properties:Cashflow vs Appreciation: Typically, all cashflow with little, maybe even negative, relative rent & value appreciationVacancy Est: 20%+ should be used to cover nonpayment, evictions & damages.Tenant Pool: majority will have FICO scores under 560 (almost 30% probability of default), little to no good tradelines, lots of collections & chargeoffs, recent evictions.

I think that if you play around with the right deals, you will find that return does increase if you lever up to 50%, but if the debt is negative leverage (interest rate higher than the cap rate, going to max LTV can actually decrease your returns due to this dynamic. 

Funny how all the accounts with positive things to say about Dream Rentals are “Account Closed” and Al, those with negative things to say about Dream Rentals are still active. 

Just remember: most negative reviews are written by problematic tenants.

This will add about $600 in potential cashflow to unit #1 but has an overall negative cashflow affect of $1000/month from a 4-unit as existing.2.)

Actually very negative cash flow rates.WWC didn't have the appetite to fund the short flow themselves, as NOI dropped so much.