If your in the loan for 6 months my back of the napkin numbers are 9 grand for the cost of money alone (points, 1k fees, interest) 12 months puts you at 13 or 14k.Make sure you understand any fees associated with the draw process, a HML will disburse funds to you as you complete rehab, sometimes this incurs fees.This deal may be viable but the costs add up fast.

50% rule I think is a great napkin rule and if you do better great but if it does not work at 50% then you need to look at other factors IE will it appreciate to an extent that a little negative is OK.most on BP cringe when anyone talks about negative cash flow. and in markets that simply don't move or the rentals are all priced based on income..

Back of the napkin calcs tell me this one is a bit over priced.

Back of the napkin math shows that 1.6mm purchase price is roughly a 6.5 CAP for C+ apartments, I would say its definitely something worth considering.

@Chris Jurgens, run your numbers and you can find out, I use this simple bar napkin math to quickly analyze, and then if those numbers work out, I analyze in depth. 

Then again he might already be renting them at $900 for all I know or even doing it as a section-8.So, my back-of-the-napkin approach says it's probably worth $300k to $350k at $3250 rents but since I've barely even scratched the surface on multifamily valuations and not even sure on the rents I'm terrified I'm wrong.My cap at auction would probably be $250k. 

For example, a quick "back of the napkin" conceptual estimate (WAG) suggests the following:Appliances (dishwasher, refrigerator, stove, hood):  $3,500Kitchen sink, disposal and faucet:  $500 (material only)Kitchen hardware:  $200 (material only)Kitchen cabinet restoration:  $3,000Kitchen countertop restoration:  $1,500Plank flooring:  $3.50/SF x 2,000 SF = $7,000 (material only)Electrical rehabilitation (including light fixtures):  $4,000Plumbing rehabilitation (including toilets, faucets & shower):  $3,000Bathroom tile (2 baths):  $5,000  New roof:  $10,000New siding:  $6,000Paint (outside):  $4,000Paint (inside):  $5,000Staging: $1,650TOTAL:  $54,350This estimate does not consider any cost associated with building permits or design professionals. 

My estimate is back of the napkin and could be completely off.  

I show my projects to investors on paper napkins at a restaurant until I'm convinced they are interested and have the ability.

If you don't have a "landlord is responsible for all sanitary fittings repairs" clause in your lease then your lease is significantly lacking.Now, if you are NOT a handyman investor and have no interest in learning this kind of work, I would go down there and have a handyman meet you and the tenant there to inspect the repair.