5 cap eh - maybe when you are more comfortable you can look elsewhere to increase your portfolio of properties.

When you're buying a new asset you don't need to cross collateralize with your existing building - commercial lenders (of which there are many in the non-institutional realm) are your best option - Scotsman will provide you with a bunch of lenders to start.

Even if you don't have a lot of background in real estate finance, they will actually guide you through the process by simply telling you their requirements. If it fits your scenario great, if not move on.

Let's say you want to buy a $800,000 apartment building that's currently returning a 7 cap actual.

A commercial lender will first look to see if 7 cap satisfies debt coverage as is - depending on that particular lender's underwriting, they will loan a certain percentage of the value (LTV) - if you develop the right relationships with a lender, you can start leveraging deals at nearly 100% loan to cost if you're buying at big discounts and it's income producing - they will have to take a 1st lien position of course.

My advice is don't use banks on investment deals unless they're selling REO and carrying back paper (which is unlikely here in CA because they move everything with cash buyers). Use a fund to start (found in scottsman guide) and stomach a higher interest rate until the asset is completely stabilized and you can then seek institutional financing - a 1 to 2 year bridge loan at 7% can make buying more properties a lot easier.