Memphis Seller Finance

[Jose Guevarra]

I have a potential seller finance deal in Memphis, TN zipcode 38128.  The home has already been rehabbed and rent ready. 

I'm assuming 7% of rent as property management fee.  That seem reasonable?

ARV: $68,000

Purchase Price: $55,000 - $57,900

Rent: $775 (might be able to get $800-$850)

I'd like to determine what mortgage payment(to seller) will be assuming I want $200/mo in cash flow. Using 40% as property management, repair, taxes, ins factor. $5000 down payment.

Cash Flow = $775 x 0.6 - Mortgage = $200/mo => Mortgage = $265/mo.

Cash Flow = $200/mo
Mortgage = $265/mo principle only to seller.
Debt Service = $310/mo

Insurance + Taxes + PM ~= $189/mo => $121/mo in savings to misc account(future repair, increase ins/tax, etc)

As for tenant/buyer:

looking $775/mo - $850/mo for rent, with $3000-$5000 lease option fee, they pay for anything less than $500. 3 year lease option. Sale price ~$70,000

* I already have someone respond to my ad with these terms. They seem interested.
* Looking to get $250/mo in cash flow may be reasonable as well.

AM I MISSING ANYTHING?