Rehab Evaluation numbers....

[Michael Dunn]

Need some clarification on the numbers I got back , when using software to evaluate a potential Rehab/Rental property I am looking at

I have attached a screenshot showing all of the numbers for the Purchase of the property

My questions , please are....

1. Is the 80% Refi. at 80% ARV mandatory ? Meaning, on every purchase of a property, once the Rehab is complete, do you Always have to do a Refi. ?

2. The total all in cost at the end of the Rehab shows $60,000

which is the price at which I want to stay at. But after the Refi. at 80% of LTV, my equity drops from $20,000 down to $16,000 AND my interest rate goes from 5.3% at time of purchase to 6.5% after the Ref.

I guess my question is, is do I have to do a Refi. ?

Thanks for the help and insight, I just want t make sure that I fully understand the way in which the numbers work, before I purchase the property.

I was hoping to have $20,000 in equity at the end of the rehab, but the numbers are showing that it will actually be $16,000

It won't stop me from pursuing the property, I was just unaware of having to do a Refi. I guess it's mandatory ?

Thanks much

Here's the link to the Rehab Evaluation/numbers ...

https://sites.google.com/site/prospectus/welcome