Investing question for beginner

[Nicholas Schwarz]

If I buy an 5 unit apartment building with a cap rate of 5% and the purchase price is $3,650,000 with an NOI of $267,117.60/year. What is the NOI if I put down 25% ($912,500) on the building? Does it change? I mean basically, does the Mortgage affect the NOI?

[Alan Pederson]

NOI = Income-Costs. So the answer to your last question is yes because with a higher down payment you will have a smaller mortgage payment and your net income should be higher.