Cash out refi strategy vs multiple conventional loans

[Samuel S.]

Hey BP Folks,

So I'm in the process of setting up a syndication deal, where 6 investors and I would all be putting in $15K ($105K total).  The investors' funds will come from either their SDIRA's or cash.    

The plan is to buy a duplex all cash, utilize the cash out refinance strategy (probably via the delayed financing exemption) and then rinse and repeat until we cannot acquire anymore loans, at which point we would look to bring on partners.

My question is, would this be the most cost effective option when pooling funds? Or would it be a better idea to try and get 3-4 conventional loans (25% down on each)?  In my mind, the cash out refi strategy seems quicker, and you could also bypass a significant amount of closing costs.

Would greatly appreciate any input!!