Analyze: Possible Sub-To Rehab (my first)

[Stinson Bland]

After several successful wholesale deals, I’ve been actively looking to take on my first rehab. I came across this deal and I need your help analyzing the situation. Do you think this is a deal?

My seller needs to sell ASAP and she needs to downsize to an apartment. My original offer was $78K but she quickly rejected it. She said she had to pay off her mortgage of $90.5K and couldn’t afford to take a penny less. I offered her a subject-to deal that she was very hesitant to take… so I added $1.5K to help with her move to her new apartment. She wants to do the deal but I'm a bit nervous... I explained to my seller that I’d have to get information on her mortgage and I’d have to get the deal approved by my ‘boss’. I do have a partner that needs to look at the deal before I can sign a contract, so I wasn’t misleading her. This house is in a very desirable part of town, next to a nice golf course. There are homes selling for as high as $91 a sq. ft. but I used a conservative number of $83 a sq. ft. At $83 a sq. I think the house would sell very quickly (under 45 days).

Details:
ARV: $151,000.00 (low estimate)
AVG DOM: 62 Days
Sub-to note: $90,500.00 (waiting to get a statement with monthly payment info)
Owner payment to close: $1,500.00
Repairs: $18,000.00
Built: 1985
Sq Ft: 1830

The house was rehabbed in early 2000’s but needs updating (paint, floor, kitchen, bathroom, lighting, landscape).

With all of the numbers above, my offer is $4.3K higher than 70% - Repairs but I figured I'm recouping that by not taking a HML. I have cash on hand to cover the rehab and I also have a low interest line of credit of $40K that could be used to finance the repairs. I am not sure how I'd fund the project but that's a good problem to have.

I've never done a sub-to deal but this seems like a pretty good opportunity to me. I will have very little money into the deal and it appears that there is at least $40K of gross profit to be made. My only cost would be: $1.5K to seller, mortgage payments, repairs, closing cost, and marketing cost. Am I missing anything?

It should be stated that my partners wife is a realtor, so we’ll save 3% on the sale.

How does this deal look to you?

Thanks for any and all advice you guys may have!

Stinson