Harsh Singh Short answer is that the 50% rule should cover everything but debt service and profit.

@David Rubio That's a great suggestions, but Listsource doesn't cover my area ha so unfortunately it is a great suggestion going unused. 

Hi i am new to investing and im reaching out for help analyzing a deal im looking into, it would be my first deal if i don't count the home i live on and i would use down money from a heloc on my home... here's the details: its two separate houses, one is $32000  1800sq ft 4 bed 2 bath currently has a $550 rental income tenant and theyre both appraised at $39500. the other is being sold for $29995 its 1212 sq ft appraised at $39500 also and has a 475 rental income they are in a neighborhood were homes around it have sold for around $70000... i would maybe use a fha loan at around 5% interest and i would also get a heloc on my first home to cover the down money... they need basic interior renovations but have newer hvac and roofs any feedback is appreciated thanks

It’s definitely a long term hold but a reservation of mine is, in ~2 yrs will the rent cover the mortgage payment and cash flow.

If you went the VA loan route and it's in a good location with strong rental characteristics, you may decide that you're willing to cover a couple hundred bucks out of pocket each month because you didn't have to put 20% down.If it's burning through a lot of cash each month that you can't cover out of your budget or other rentals, you'll have to look at how much equity you have, what you could sell the property for, and what you'd clear after expenses and fees. 

Is there anyway you could have the seller cover any of it?!

As soon as you make additional payments beyond loan interest (i.e. loan repayment, capital expenditures) then there is no guarantee you will have positive cashflow.So the quick rules of thumb for guaranteed positive cash flow are:cap rate is greater than interest rate (you've got this)the difference between cap rate and interest rate should be large enough to produce cashflow to cover loan repayment/amortization and capital expenditure plus some amount left over for the investor.if you're in a deal where you're financing with interest-only loan payment and there is no capital expenditures, then YES cap rate being higher than interest rate would very likely produce positive cash flow.Cheers...

I have felt like that seller-just make sure your bases are covered.

I mentioned to  them their renters insurance may cover the food .

So the way around it is to get a property manager, which costs you 10% of rents in fees, so you'll be covered under the PM's E&O insurance.