ARV

[Tony Rosa]

Hello ,stilling learning and reading the REI ,I'm a little confused on the percentage you have to use when making a deal for a wholesale.Does it depends on how much the property is worth?

[Lonnie Pickard]

ARVx70%-Repairs-your fee=MAO (Maximum Allowable Offer)

For example...you find a property that's worth $100,000 after repairs.

It needs $15,000 in repairs.

You want to make a $5,000 wholesale fee.

Your formula would look like this... $100,000 x 70% - $15,000 - $5,000 = your maximum offer of $50,000.

Although, 70% is a rule of thumb, I usually start at 60 - 65%