Help Analyzing Deal

[Scott Dwyer]

Hi,

I've been reading these forums for a little while now and have learned a tremendous amount in the short time I've been here. I was wondering if anyone could help analyze my first RE deal?

I put a 4 BR/1.5B house under contract 10 days ago. I have it under contract for 70K. My ARV is 123K(Appraisal). My rehab costs are 21K.(not to exceed quote)

Since rents in the area aren't as high as I'd like, around 1,000/month, the property doesn't cashflow. I'm thinking about flipping this property since it seems like the only option I may have at this point.

I've sent an addendum to the seller today to drop her price to 65K to compensate for overages in repair estimates. I have an inspection/contractors clause in the contract where I can back out after the 15 day inspection period and recoup my deposit.

If she accepts the addendum at 65K my total in money is 88K(65K+21K rehab+2K CC) = 88K

If I sell the house for 123K my gross profit is 35K. Subtracting 7% CC out ($8,610) my margin is $26,390.

My monthly holding costs are approx. $500/month.(incl. taxes, ins., utilities & interest on loan).

Is this a deal? Should I be pressing the seller to 60K?

If the property doesn't sell for six months my holding costs are ~3K. Bringing my net profit to $23,390.

I'm having trouble sleeping the last few nights overanalyzing this in my head. I understand fear is a good thing and is very natural when doing something like this for the first time, but I keep hearing this voice in the back of my head telling me to pull out.

As an avid poker player I understand that scared money doesn't make money, but I can't shake this voice. It seems to get louder and louder as each day goes by.

Oh, I almost forgot to mention I'm getting married in 4 weeks. Yeah I know I'm crazy. The closing is scheduled for the day before my wedding, although I'm trying to move it up 2 weeks.

I thank you in advance for your responses.