Wholesaling Formula for offer price

[Lily Rodriguez]

I'm sure that this has been posted here already. I just want to share the formula to new wholesalers because I have been getting deals that don't make sense for myself or my investor clients and in order for you to get a good wholesale deal to your Cash Buyers you need to know this formula. It does varies depending on your market.  For this example we will use 70% 

For this formula you will need to know the following:

ARV=After Repair Value ( How much will the house will sell for after making all the repairs needed)

Repair Estimate - (Send me a message and I can send you a list I got from my mentorship class for ball park estimates based on square footage and depending if you need cosmetic repairs, avarage repairs or Extreme repairs)

Your Assigment Fee

ARVx.70 - Repairs - Your Assignment FEE = Max Offer

Example

$200,000 x .70 = $140,000 - $30,000 (repairs) - $10,000 (your profit) = $100,000 (offer)

Your potential profit is $10,000 

I hope this formula helps you make offers that will make sense for all involved in the transaction.

Happy Wholesaling,

Lily Rodriguez - Investor friendly Broker

[David Ramirez]

Quote from @Rafael Mercedes:

Hi Lily!

Thanks for posting this.

My one question is this:

Do we minus repairs, liens, judgements, etc BEFORE the discount that's applied for the cash buyer? In my head I see that the property value must come down to it's actual value (minus all liens/rehab) before discounting it for the cash buyer and then taking your assignment cut. Any clarification would be appreciated! Thank you.

 Sellers are responsible for any liens that the property has, and those are taken off the proceeds of the seller at closing.