Bad deal or just bad math?

[Travis W.]

Hello everyone,

Just double checking my math on my current home. Can anyone give me insight regarding these numbers? I am pretty new so I am not sure if they are right..

1. Bought a house for $127K. at 3.750 interest using a 0 money down 30 yr-fixed VA Home loan. (paid $1k in earnest money).

2. Monthly payments for the house are roughly $826. Principle is about $194, Interest is $394, and escrow is $237. Utilities are $220-250.

3. The house is a great house in a great location, and I think I can get 1300, maybe even 1400 dollars in rent a month.

Now, I used the BP calc to determine cash flow.. and I feel like its off or I am missing something. It is claiming my P&I is 550ish.. which isn't wrong, but I pay the escrow on top..so its effectively $300 dollars more a month than what the calc shows. So,

Scenario 1: $1300 rent + tenant paying utilities seems to cash flow out close to $200-300 dollars.

Scenario 2: $1300 rent + myself paying utilities seems to be negative $57 cash flow or so.

If I didn't have the escrow, it would be like $400 a month in cash flow.. I guess I don't understand how escrow account works..

 I would assume that follows me wherever.. So am I misreading my math here, or did I not fork out enough for a down payment to lower monthly interest payments and its biting me hard in the cash flow area? Or is this one of those scenarios where its better to take the loss for a bit until I can maybe do a refinance and offset some? or am I actually ok on this..