Proper Financing Structure
I'm thinking of buying 4plex and want to finance in on a 3year interest only 80% with a 15% 2nd and 5% down. My reason is in 3 years it should have 20% apprication and I can refi getting rid of the 2nd. I'm think then still doing a interest only to live off the money for 10 years or so or longer and if I need money then I should have up in the 60% equity range. does this make sense? I will have a $700 a month positive cash flow at the start but I want that to go to resevers for three years or so. Thanks for all the valueable info on this site
Great Idea but I worry that you might in your area be out of time. The Spike has a wobble all up and down the Pacific Coast. What you might have to bonus in interest and points to achieve the position might destroy you if the market wobbles and I see small wobbles over the next few months until December and then watch it with great care. Give yourself an escape route. Plead insanity .
I would try and accomplish the same result with an Owner take back for the second and watch your times you might need more time. You might look for an additional transaction for income.
Reading your market, you have a fairly high unemployment rate and a few industries trying to find new homes. Does this impact your calculations?
Cheers Lucius