Buying Property w/w/o Loans

Member since 2026 · 3 posts · 4 votes

If you have plenty of capital to buy property’s completely without a loan should you? In this point in time when interest rates are in the 7’s

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Ametria Chaney
Realtor · Memphis, Shelby County · Member since 2026 · 411 posts · 139 votes
13h
Hi Nikola, great question, and with rates in the 7s it is one a lot of investors are weighing right now. Paying cash has real advantages: no monthly payment, stronger cash flow from day one, and a simpler, faster close that can make your offer more attractive to a seller.
The tradeoff is opportunity cost. The same capital that buys one property outright could be the down payment on two or three, so cash can slow how fast your portfolio grows. It also leaves less in reserve if a roof or a vacancy hits right after closing.
A middle path a lot of investors take is to buy cash, then refinance later once the property is stabilized, or to finance one property and keep cash in reserve for the next deal. There is no wrong answer here, it really comes down to whether your priority is maximum cash flow per door or growing the number of doors.
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Chris SeveneyBusiness Member
Moderator
Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
12h
The question will have a different answer for different people. When you pay for real estate with cash, you have some liquidity issues. If you need the cash for liquidity, no, I would not pay cash for property. If liquidity is not an issue, then yes, pay cash. The other alternative is to look at or target potentially 30% to 50% leverage, which would still allow you to make the payments and keep the cash on the side. If it's an investment property, the rental income would cover that payment.
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Ryan BakerBusiness Member
Lender · Strongsville / Cleveland, OH · Member since 2026 · 176 posts · 48 votes
12h
Nikola, it really comes down to what your cash can earn somewhere else. If you can spread that capital over more deals and each one still cash flows after the loan payment, leverage usually wins. All cash is simpler and wins more offers, and you can always pull money back out later with a cash out refi once it's rented. A lot of investors do exactly that: buy cash, rehab, then refi into a DSCR loan.
Run both ways on one real property: cash on cash return buying all cash vs with 75% to 80% financing. If the financed version still clears your target, borrow.
Glad to run those numbers with you on an actual deal. Give me a call, my number's in my signature below.
– Ryan
[email protected]330-548-4430
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Amber Stout
Lender · Tampa/Saint Petersburg, FL · Member since 2014 · 383 posts · 153 votes
10h
Hi Nikola - I think it really depends on the investor and what their goals are. I know some successful investors who prefer the certainty and peace of mind of owning a few rentals free and clear, so they choose to pay cash.
On the flip side, if your goal is to scale and build a larger portfolio, financing can be a great tool. Rather than tying up all your capital in one property, you can spread it across multiple investments while keeping cash available for reserves, renovations, or other opportunities.
Even with rates in the 7s, I wouldn't automatically rule out financing... I'd look at the numbers, cash flow, cash on cash return, and overall strategy. Leverage can help accelerate growth, but it also adds risk and monthly obligations. Neither approach is wrong - It comes down to whether you're prioritizing cash flow, peace of mind, or long term portfolio growth. Are you looking to build a portfolio or just acquire a few rentals?
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