Worrying about things beyond our control will just lead to additional stress and serves no purpose.P.S.

the more properties you have the less reserves per property you need and the safer each additional loan is.

The HML lender will provide additional draws throughout the construction process.So, here's the tricky part that I'm still working on, which is funding the construction throughout the process to keep the work going, because I don't want to wait on the draws to be reimbursed MY OWN money.

Zillow has already stated that its target is to net just $3-$5k per deal, and by volume, create an additional $1B in revenue.

.- Purchase a 2-4 unit with an fha loan- After one year, I can buy a 1 unit with a HomeReady loan w/ 3% downB)- Don’t refinance fha - Buy a 1 unit with HomeReady loanThe opportunity cost here is not refinance get fha and missing out on an additional stream of income from getting another multi.I just started with my research and I know there is more out there.What I highly suggest those starting out to do as a short term plan is- buy a 2-4 unit with the HomePossible loan w/ 5% down- after 1 year, buy another 2-4 unit with an fha loan with 3.5% down- after 1 year, buy a 1 unit with 3% downI heard this plan recently on the JF1401 podcast.

It doesn't stop here though, because the addition of the apartment added massive value to the home we are able to access more equity which we are going to use to build 2-4 more units in our back yard (we have a large backyard that runs all the way back to the other street. 

In addition, the more creative real estate finance minds aren't handling these smaller loans.

I'd recommend the exercise to anyone.

So, in addition to paying interest on the unpaid interest, I have to write you a check for $250,058.86 at once, five years from now.As a seller and lender, no way either. 

Now for the numbers:Year 1             Year 2          Year 3           Year 4             Year 5INCOMEGross ScheduledRent Income                         266,400        274,392         282,624         291,102           299,836TOTAL GROSS INCOME      266,400        274,392         282,624         291,102           299,836VACANCY & CREDIT LOSS       7,992            8,232             8,479              8,733               8,995GOI                                        258,408        266,160          274,145         282,369          290,840OPERATING EXPENSES     Accounting                          2,000             2,060               2,122             2,185              2,251     Advertising                          1,000             1,030               1,061             1,093              1,126     Insurance                           15,000          15,450            15,914            16,391            16,883     Janitorial Service                 4,800             4,944              5,092              5,245              5,402     Lawn/Snow                          2,400             2,472              2,546              2,623              2,701     Legal                                     4,000             4,120              4,244              4,371              4,502     Property Management   12,920            13,308            13,707           14,118            14,542     Repairs/Maintenance     15,000            15,450            15,914            16,391           16,883     Supplies                                 500                 515                  530                 546                 563     Taxes            Real Estate                40,000            41,200            42,436            43,709            45,020     Trash Removal                10,400            10,712            11,033            11,364            11,705     Utilities           Electricity                      2,800              2,884              2,971              3,060               3,151           Sewer/Water             12,000            12,360            12,731            13,113            13,506TOTAL OPERATING      EXPENSES                      122,820          126,505         130,300          134,209           138,235NET OPERATING       INCOME                         135,588          139,655         143,845          148,160           152,605                                                Year 1             Year 2            Year 3            Year 4              Year 5NET OPERATING     INCOME                     135,588           139,655          143,845         148,160          152,605- Debt Service                109,969           109,969          109,969         109,969          109,969- Cap Additions                          0                      0                       0                     0                      0 CASH FLOW BEFORE           TAXES                       25,619             29,686           33,876            38,191            42,636Cash-on-Cash Return          7.92%              9.18%          10.48%          11.81%           13.19%(CFBT/Cash Inv.)Capitalization Rate              9.00%              9.27%            9.55%             9.83%            10.13%Debt Coverage Ratio             1.23                1.27                1.31                1.35                1.39PROJECTED SELLING           PRICE                     1,506,500      1,551,700       1,598,300      1,646,200        1,695,600- Costs of Sale                     105,455         108,619          111,881         115,234           118,692-Mortgage Payoff           1,175,708       1,144,134       1,110,361      1,074,237        1,035,598BEFORE-TAX SALE    PROCEEDS                      225,337          298,947          376,058         456,729            541,310IRR Before Tax                  -22.39%               4.85%           13.83%          17.55%              19.25%Thank you for taking the time to analyze these numbers!