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Thanks..

I read the great blog by Rob Barney, “Bird-Dogging 101” where he gave you the general rehabbers calculator “A Typical Deal By The Numbers”.
For those that haven’t read it:

http://www.biggerpockets.com/articles/bird-dogging101rb.html

I am trying to build a calculator for my network of buyers that I can adjust numbers and percentages to give me an idea of what I can offer sellers

HOW DO YOU CALCULATE CLOSING COSTS?

Thanks alot!

:shock:

Wow!

Mike, I appreciate your time to break it down to me. I kept running the numbers with different analysis programs which where spitting out pretty much what you said (sorry about the botched up math) about the NOI. One of the problems was I skipped over the fact that the mortgages where different, thus creating different outcomes.

The latter of the scenario brings a reality to why the home owner wants out! In the same light, it also shows me how authentic the subject to is used/needed.

Thanks for all the help. .. ..

SB

Hey Fizz!

You want to create a LLC, S Corporation, C Corporation, etc for one main reason (in my opinion) and that is it (the corporation) is considered a separate entity and thus, heaven forbid, you get sued. ..the IRS (in most cases) can't come after your personal assets (the Lamborghini, the house and/or your money in the bank). . .this is key.

Other perks include taxes, credit lines, etc.

As for a good website to get your legal game tight. . .try http://www.legalzoom.com

Honestly speaking, creating a corp is not that hard to do and if you do it yourself, it is cheaper. But that is only my opinion.

Hope that helps

Happy Investing!

$182.75/month ($2193/annual) to be exact.

I threw out the 10K as a high assumption that each side needs paint, carpet, cleaning and landscaping. . but that is only “IF” he accepts my offer at 15K.

ARV = 65K
65% of 65K = $42,250 (This makes it worth my time)
65K – 42,250 = $22,750
$22,750 – 10K (assumed repairs) = $12,750
Initial Offer $12,750

BUT. . .

If we negotiate a “SUBJECT TO” agreement due to the fact that he wants out of the situation, I can assume the mortgage payment... .. I won’t spend a dime. I would make the mortgage payment and both tenants would continue to pay $400/ month rent ($800 total).

THE QUESTION

Am I looking at this correct?

“Due Diligence”

As I was posting I started to think of “what is my own personal system” when doing my due diligence.

Let’s say it’s an absentee owner and wants to get rid of the propriety for 10K, a great wholesale opportunity. . .what is the typical checklist one would go through in doing a thorough due diligence??

My fear is that I’m not doing everything that I can.

Thanks!

Happy Easter!

“Subject To”

Harry Homeowner has a duplex that he absolutely wants out of. He is willing to do whatever he can to get out of the situation. Truly motivated.

Due diligence brings back the facts that he just bought it in late 2005. Bought it for 54K and claims to owe 50K as of today. He said the rental game is to slow for him and he wants out. The ARV is around 65K

Lets just say that the house is needs a little work (>10k) and it has tenants in both sides of the duplex. His mortgage is 500 and the tenants are paying 400 a month. Lets just round it to about 200 monthly cash flow.

I personally was going to offer him a low amount like 12K -15K but I thought, what if he doesn’t take. . ..lets say this is a decent property in a decent “rental” neighborhood. . .What would my second option be? I thought, maybe a “subject to”. ..

I have never put together a Subject To deal and wouldn’t necessarily recognize one and wanted to ask the advice of the community about Subject To’s and their pluses and minuses… and would it apply in this situation?

I appreciate everything!

SB

My name is Steve and I am from Central Ohio, Buckeye Headquarters, and I have been exploring REI for a little over a year. I just recently launched my career as an investor January 2007 and started my company Paramount Principle, Inc

I am a web designer/ graphic designer by day and an investor by night trying to build a consistent system and get and maintain deals in the pipeline. ..

Short sales. .. . note buying....thats pretty much the direction I seem to be heading in.. ..

I love this site and I appreciate the wealth of knowledge available. . thanks!

(raises his glass) ..to bigger pockets!