Analyzing my first deal. A Foreclosure. Would love some feedback.

[Stephen Frick]

Hey guys. Looking at a possible buy and hold deal....first one!!! Used the SFH Rental Analysis file. It was a huge help. The deal looks okay, but I would love some feed back on my numbers. Full disclosure, I like to be very conservative on my numbers so I could be selling this deal short.

The foreclosed property is a 3/2* (there is a third bathroom which is in a detached space that isn't usable at this time so I would rent it as a 3/2).

Price 73K

Looks to be in good shape, but won't really know till we get in there this week. From the pictures and what we saw from the outside, estimate about 10K in Reno Costs.

Mortgage payment - 438/mo. Trying to line up a private family investor who I think will hold the mortgage and we would pay 6% on a 30 year. Getting less than 1% on it now in the bank I work at.

Closing Costs - I estimate around 3%

Rent - Conservatively figure 950/mo

Taxes - 1969 last year

Insurance - I estimated at $1500/yr, taking into account our millage rate

I used a 8% vacancy rate

I used $1200 per year for maintenance* (Not sure what to estimate here, please any suggestions on this figure)

Good news is, the house is .10 from my house so we plan on managing the property ourselves to save costs. Also the bad news though. Not sure I like the idea of running into the tenants in a social setting or walking in the neighborhood. But I don't really want to let that kill a good deal.

Final Verdict: at those numbers it doesn't even come close to the threshold of $100/mo. However, If I can negotiate a bit and get the bank to agree to 62K, then I like it a lot more. (Assuming all of my numbers are accurate)

Please provide feedback on my numbers and any experience you may have negotiating with a bank on a foreclosure.

Thanks everyone! This site has really opened my eyes that anything is possible!