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Updated over 6 years ago,

User Stats

67
Posts
37
Votes
Christopher G.
  • Rental Property Investor
  • Hohenfels, Germany
37
Votes |
67
Posts

42% ROI: What am I missing???

Christopher G.
  • Rental Property Investor
  • Hohenfels, Germany
Posted

Hey there, so I'm in negotiations with a seller of 3 condos for $105K.  These are my numbers below...this is a 10 year balloon at 6% interest amortized over 30 years.  At the end of 10 years I'd owe $80K (which I'll pay extra on the principle monthly,so I don't owe anything come balloon time).  Is there any reason I shouldn't take this deal?  

Also, how do you calculate the reduced interest payment when you make an extra principle payment? I can see this getting very complicated if I make extra monthly principle payments.  Are there certain different types of amortization methods that I need to decide on and put int he contract so we are calculating interest payments the same way?

Thanks

Net IncomeOfferDown PaymentLoan AmountMortgageP. TaxInsurMaintenanceManagement FeeHOATotal Fees# of UnitsIncome / UnitGross / MonthROI
$348$105,000$10,000$95,000$570$125$108$92$185$417$1,4663$615$1,84542%

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