The latter options may not appear to be as attractive, but they could possibly increase your cash flow on the quad, and allow you to purchase another property with an FHA loan a year from now.

By doing it this way it drops the cash on cash return (below 10-12%) because it is increasing the expenses.

When times are good, you have the ability to increase your principal.

Having a couple of credit cards, student loans, car payments, home loans, etc. and paying them ON TIME every month will increase your credit score. 2.

I gave them 45 days notice of the new lease and rent increase (5/15).

That is an easy way to increase the value.

For example: by spending $10k, rents can be increased by $100 ($1,200/yr.) and $1,200/$10,000 = 12%.

Or, if you're happy to stay living there, but want as much immediately accessible cash in your pocket as a Lender would approve, you'd need to make sure your newly acquired investor mindset was in full bargain hunting / return-on-investment mode, because, your monthly repayments will increase significantly once you withdraw the maximum against a HELOC!

Using this method you could essentially save and continue to build on that 20,000 or you could put it into the property to increase the value while simultaneously increasing the rent.

So I was always looking at this as an investment property, butI didn't know the first thing about REI at the time.Let me ask you a question: The property value has increased by about $40k with comps selling for close to $200k.