Need help evaluating a deal and understanding the math

[Kat Wyninger]

Hi all - I'm just starting and I've found what could be my first property, but I can't figure out the math using online calculators. This is a 2bdrm/1ba sfh that is currently rented for $350/mo to a long-term tenant. The seller is asking 39,900 and is reluctantly willing to owner finance, but wants 5,000 down, 10% interest, and is only willing to finance for 24 months. I think fair rent for the area is closer to $500, but I tried to figure it out estimating a rent of 400 month. If I use the 50% rule then there is only $200/mo for the mtg payment and any cash flow. When I try to use online calculators, I'm coming up with a monthly payment that is higher than rent?? Does that sound right? Kat