When I started buying rental property a few years ago I financed them all with 30 year mortgages. I wanted to create the most cash flow possible so that I could continue to buy more rental property. If I financed the property with a 15 year mortgage it would eat up the cash flow and wouldn't give me the money I wanted to buy the next deal. Buying properties in Denver four years ago, using the Hard Money and Refinance Strategy, I was buying property that cash flowed $700 a month with 30 year notes; in most cases with less than $5,000 out of pocket. So that meant I could buy another property using the cash flow every few months. Prices were low, finding tenants was easy and my cash flow increased with every purchase, life was good! While preparing for taxes this year, I was reviewing mortgage statements on rental properties, seeing my monthly average principal pay down is about $125 a door. I currently have 10 properties so the pay down is slow. When I bought properties with 100% financing on 30 year mortgages I wasn't expecting that I would have principal pay down over night, I also wasn't expecting to be paying the same mortgages at 60 years old.
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