Is the deal worth it??? NEED TO LOCK IN TODAY IF SO

[Michael Junior]

So I have an offer out on a flip in San Marcos CA. Its a manufactured home brought to me by a wholesaler. 

Now before everyone jumps on me and says there no skin in the game let me start off with the reason im so gun-ho about doing this deal. 

1. Need to build relationship with hard money lender out here to get better terms on future deals

2. Need to jump into the pool and stop sitting on the edge. It's been two years since I did a personal deal , I've lost some confidence and have had analysis paralysis for months now. 

3. This will be my first flip in CA, need to run through the motions on a somewhat easier deal as far as reno goes to get the ball running.

Numbers as follows : 

PP: $438,000

Loan amt (25% down )- $328,500 

points (1.5% )- $4,927

interest (10.5 % plan on holding for 4 months )-  $11,497

Commish on sale ( im an agent will list myself so only accounting for buyers agent 2.5% )- $13,895

Closing costs ( 1.5% of total purchase and sale )- $15,000

Holding cost ( hoa, misc )- $1,000

Reno cost: $38,000 

- 3 windows $2,000

basic kitchen rehab- $10,000

flooring ( luxury Vinyl flooring )- $5,000

gutters ( one run ) and minor fascia repair- $2,000

Exterior landscape clean up- $5,000 

2 bathrooms- $10,000

Paint- $3,000

Misc- $1,000- Dumpsters 

Private money fee: $5,000

ARV: $555,000 - Conservative the last two comps sold at $570,000 and $580,000 both moderate condition.

Im using a hard money lender for purchase @ 10.5% with 1.5 points. 25 % down

And borrowing $100,0000 of private money w same terms to help cover majority of DP. Ill be covering reno.

So i'll have $5,000 in fees for private money. 

I'll be out of pocket roughly $60,000 

Profit if sold for $555,000 after all hard/private money fees and reno costs = $27,681

Please let me know your thoughts on this deal. Need to lock in today! 

[Michael Junior]

Jay thank you sir !

So I am over compensating on reno costs, Its truly all cosmetic. There is also things I can do as well if need to be to cut costs such as paint and flooring. Have done it on my past projects. As well as hold time, the other two sales in the community went into escrow in 2 days so if I can bang out reno in a month which should be no problem and list aggressively at 549k to entice multiple offers I'm confident it'll move well over ask ( but who really knows )

But yeah I agree the cushion is light. So ill take that advice and try to hammer back the price a bit. I think my eagerness to get something going is making the 27k look more appealing than it is. I should also mention im active in RE sales. I have multiple escrows ongoing with buyers and sellers in the pipe. So its not so much about living on the spread as much as it is as popping the cherry and getting in the damn game