Possible sub2 deal

[Robert Carpenter]

The Problem

1.  The seller will take 750K for a house with an AVR of 1000K

2. The house needs 150K worth of work

3. He won't get out for less than a 250K Down Payment 

4. He owes 260K on the mortgage

5. His payments are 5000 a month PITI

6. He will seller finance sub2

7.  He's on year 25 of the mortgage as follows:

Year 25 (289-300)	$57,289.84	$45,919.56	$11,370.28	$259,232.06
Year 26 (301-312)	$57,289.84	$47,790.39	$9,499.44	$211,441.67
Year 27 (313-324)	$57,289.84	$49,737.45	$7,552.39	$161,704.22

The Proposal

1.  Take out a second mortgage 450K   private money loan at 5 % with 2 year balloon interest only payment of 1650 

2. Give the seller a carry back third mortgage at 0 % interest  for 240K with a 2 year balloon 

The Exit

1.  Lease option the house to a tenant buyer for 7500 a month

2.  Right to purchase for 1,075,000

2.  Down Payment of 75K to be applied to purchase price

Deal Analysis

1.  At closing pocket 50K, set aside 150K for repairs, give seller his 250K DP

2.  Collect buyers 75K DP

3.  Collect 850 per month rent x 24 months = 20K

4.  At end of two years collect 1,000,000 from buyer

5.  Pay off 160K still owed on first

6.  Pay off 450K owed on second

7   Pay off 240K owed on third

Total value of the deal

   (50 + 75 + 20 + 1000 ) - (160 + 450 + 240) =  1145K - 850K = 295K

Have I got it all goofed up good, or could this possibly be feasible ?