What is your financing strategy?

3 Replies

I'm looking at the different advantages of purchasing properties cash vs mortgage. Obviously I like the lack of risk with purchasing cash but I also like the leverage of purchasing with a mortgage. IE buying 5 50k properties vs buying 1 with 50k cash. 

What are your thoughts on the risks vs rewards? Which do you prefer and why? 

@Matt Cramer  

I would rather maximize financing and have more money in the bank and for reserves. I prefer a consistent mortgage payment and getting more properties. Here in NY property taxes are high and I hate to hand out thousands and thousands in one sitting.   

I buy mostly in cash and get short term <5 year loans from private investors, occasionally hard money. You will get passionate answers from both sides on this site. Both strategies have made people wealthy :)

Every situation is different and depends on your niche and strategy. I'm like you. I would rather use leverage to purchase more property rather than using up all my cash on one deal.  My first deal I did owner finance on a 5 year note. I'm going to do a cash out refi on that property and use the cash to purchase more properties and just keep on leveraging. 

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