On the lower end of the rent range you'd be negative.Now I assume that he would have the taxes and insurance escrowed in the payment so the numbers will be better than that.But I just waned to illustrate that you want to run the full battery of expenses to make sure the place will in fact cashflow at an acceptable level for the risk and hassle.Not trying to discorage you at all since it very well could be a very good deal, you just need to verify that it is.

Worth maybe 175.This probably illustrates why I'm exploring new strategies.

Rishel shared illustrates, at huge risk.

It has short, well illustrated banking and business information. 

Late fees are considered additional interest, the application of payments paying interest first is standard and accepted practice.Yes, if payments made don't cover the principal reduction you'll need to manually apply payments as I illustrated.

Here's the simple formula for illustrative purposes: Gross rents - expenses = Net Operating Income X cap rate = estimated value If you know what the gross rents are, you can use the 50% rule to estimate the expenses.

Great story and illustration @Jay Hinrichs !

Again, this discussion a great illustration of the landlord challenges in California vs. other redder states.

Unless your friend has the money to pay back the lender the full amount owed after whatever the buyer is willing to pay, there's no deal.Here's the math for illustration (I have no idea what the actual numbers are):  She owes ~60k, the house is worth ~42k, if you subtract ~20k in repairs, now you are down to ~22k of value before you even consider any other costs or possible profit for an investor!

@Deborah B.That 2% rule is very market dependent.As an easy illustration,I will give you a portion of our portfolio.We have 17 SFR under management here in Houston, we average $400 a month in income (after taxes, insurance etc..) on those property giving us around $6800 a month passive.