@Emad NasserTry to get a quote on what loan you can get for this property, so you can factor your debt service into the calculation and see what your cap rate is.

If the property & loan is small the cost to collect on an unpaid debt is a much higher % of the total debt.

Make sure you possess that skillset

@Nicolas Da SilvaTell us the cash flow with the debt service and without, and then what the cash flow would be with the PMI.BTW, you called this a legal duplex, but did not call it a legal non-conforming triplex.

They will respect you and you’re doing them a favor by them not going into debt.

Other than a response of knowing what your comfortable debt level is, how do you decide how much debt to put on a rental property, if any at all?

Currently I do not want to buy a new car and have a new debt to pay off, however I have had trouble with getting really bad used cars.

That is, you can’t use more than 10% of your net worth exclusive of your home and possessions, per loan.

We have about 78K in CC/personal loan debt.

Gross Potential Income(-) Vacancy, Bad Debt, Concessions(-) Non Revenue such as model or employee units= Net Rental Revenue(+) Other Income such as utility incomeYou need to net out vacancy before calculating what the utility income will be since it is tied to occupancy and usage.