It is a 4 Unit with 3 units occupied with myself to occupy the 4th.Sale Price: $115,000Loan: $92,0003/1 ARM @ 3.25%Mortgage: $400Tax: $265Insurance: $75Expenses: $985Gross Rent: $2200Thanks for your input and advice!

I would think more along the lines of what is the minimum amount I am willing to make in a deal plus a safety margin.

Half of all SFR's in most of these towns are RENTALS.. so there is a huge supply of rental stock.Then you have the purchase of the property it self it goes like this.Local investor wholesaler sells to local rehabber.. ( profit has been made in this transaction) Local rehabber sells or markets with local turn key company ( profit is made in this transaction) then if the local turn key company does not have a proven marketing arm then they hire West Coast marketing folks to sell the properties for them and then yet another fee is added to your eventual purchase price... ( this leads to inflated price's for the end buyer)...So in your hunt I would suggest you try to go as direct as you can to the assets.

You might get a 15 year fixed, ARM, or balloon or some combination.

That clause would be your safety net.

I'm financing the property with a 30 year 5/1 ARM starting at 4.75%.

They generally do 3 - 5 year ARMs.

While that is certainly true in many cases, don't forget that location (ease of access to amenities, views, noise from traffic, construction or industrial parks, cleanliness/safety of the neighborhood, and overall situs for the area) is a big factor that influences value as well.

When you go to a bank for financing they're not running those kinds of numbers because what's really important is that they're comfortable the property will throw off enough cash flow to cover debt service with a margin of safety and be worth enough that they can recover their principal if you default.

Sorry Chris, but you can be offended, but you are incorrect on the facts, regardless of your opinion...Normally, I would not continue to comment, but the topic of the thread is the meeting starts with our REIA, so therefore, YES, I will respond when someone knowingly posts incorrect information on our organization.We welcome you with "open arms" and if after you have attended one of our sessions you think we stink, then I would be hurt, but I would concur (at that point) that you were entitled to your opinion, based in fact.BUT at this point, you're just commenting on something with which you have ZERO first hand knowledge.