Flipping using Hard Money calculations

[Daniel Llauger]

Hey BP flippers pro's

This is the first time I've been doing a flip using Hard Money, and I've been struggling with the numbers to the point if I'm doing the math correct or not. 

I have used BP calculator and I also created an spreadsheet, but most of my numbers for profit are too low or negative... If I have a deal like this for instance below, what would be your numbers?

Hard money lends 75% ARV, 10% of loan and 2.5% origination fee, assuming I'm paying closing costs when selling the property ($5,000), here are my numbers...

I might be doing (substracting) something that I shouldn't ?... Any help is appreciated, 

Purchase Price - initial	$118,000.00
Earnest Money	$5,000.00
Fees from wholesaler	$295.00
Purchase price	$113,295.00
ARV	$185,000.00
Rehab	$45,000.00
Purchase Closing Costs	$1,500.00
Loan Amount calculation	ARV x 75%
Max Loan Amount	$138,750.00
Actual Loan Amount	$138,750.00
Monthly Interest payment	$1,035.63
Max Monthly Interest payment (after all draws)	$1,300.78
Final Loan Amount to pay back lender	$124,875.00
Holding Costs in Fix & Flip BP report
Rehab and sell property (months)	5
Costs per month	$620.00
Total Holding Costs	$3,100.00
Financing Cost
Highest monthly interest payment x months	$6,503.91
Purchase Cost in Fix & Flip BP report
10% of loan	$13,875.00
2.5% origination fee (min $2,500)	$3,121.88
Prepaid interest	$36.33
Total	$17,033.21
Initial investment
Out of Pocket pp+rehab - loan amount	$19,545.00
Out of Pocket - EMD	$5,000.00
Purchase Costs / Lender fees	$17,033.21
Total	$41,578.21
Sale Cost (from bp report)
Agent commission/fees 6%	$11,100.00
Sale closing costs	5000
Profit
Total (pre-income tax)	-$3,657.11
ROI based on 5 month flip	-17.59%

[Kyle Ebersole]

Ken Na's response was really good on how he goes about calculating his costs. I do it the same way he does it. When I run numbers, I use an excel spreadsheet that calculates everything involved in the process. My first section is all my rehab categories broken down, the next section calculates the Purchasing/Holding/Financial costs, (Origination fee, interest, closing costs, utilities, taxes, mowing fees etc), then my last category is my selling  costs (Transfer tax, commission fees, sellers assist/inspection contigency, etc.) What that does is it shows me really quickly if a deal is going to work or not. With the numbers you showed as an example, I'd recommend turning this one down and looking for your next one. 

Also just wanted to touch on your hard money lenders. I have connections with hard money lenders that give me 100% of the purchase price, rehab budget, and closing costs of a deal. I pay them 10-12% interest and 1-1.5% as an origination fee. I would suggest pushing to find some lenders that give you those terms. Completely changes your deals and keeps you from having to bring money out of pocket!