I have bought several properties in the last six months using this exact method and I can tell you there is no science formula to it.

That's the formula.

I could also use some help on a net rent formula, thanks for your time.

Financing deals through several investors is basically a banking operation and if you have an investor who squeaks really loud you can have the state banking authority knocking on your door.What I'm saying is that there is no 100% safe way that avoids all banking and security issues regardless of what an attorney might tell you, after all, the attorney has an on going opportunity representing you as issues arise.The way to put such a lender group together is to obtain contractual loan agreements with your investors, as a loan committment, to make future loans available within a short period of time.Usually obtaing short term financing for long term obligations is a good formula for failure.

Following that formula, unless my rents are double my expenses, my debt:income ratio goes up, and after the addition of five properties, may be into the 40s, making a 2nd home purchase difficult.Am I looking at the correctly?

Laurel, Here is the formula I use to get my numbers.$150k ARV-35% (20% Profit, 15% Closing/Holding Costs, Etc)-Repair Costs-My Assignment Fee=Maximum Purchase Priceor$150,000-$52,500 35%-$40,000 Repairs-$10,000 My Assignment Fee-----------$47,500 Maximum Purchase PriceI would assign the contract for $10,000 for a total sale price of $57,500.The Investor has a potential profit of 20% or $30,000.If it doesn't sell at that price I can lower the price $5,000 and still make $5,000 on the deal.

All should be answered before anyone can possibly give you any useful advise.Here is the Formula I use to find my Maximum Offer Amount.Example:say the ARV is $100kRepairs are $20K40% for closing, holding, taxes, insurance, etc and profit (depending on your market this could be 30% or 35%)I use 40% to make sure I have a very good assignment deal any investor would want.The most I would offer would be $40K, But I would start at $25Kor$100K ARV-$20K Repairs-$40K 40% Profit and costs =$40K Maximum Amount I Can PayThe Numbers are what will tell you where you need to be on price NOT what you have to spend.Again, this is just an example you will need to input your own numbers to get YOUR Maximum Amount you should pay.Hope this helps

Bill,The theme song is "Churn, Churn, Churn" - similar to this one :D http://www.justsomelyrics.com/1831974/Peter,-Paul-and-Mary-Turn-Turn-Turn-Lyrics

Does that mean they are trying to be unethical by not showing any other statistics regarding the property or does it just mean they are letting potential buyers figure out their own figures to come up with ROI and cash flow as most investors use their own formula regardless of the market.

I only wanted an ARV to plug into my wholesale formula to arrive at a price I can home under contract.