You actually only have a taxable gain of $9,628 ($14,668 + $9,505 - $14,545) we add back the principle amount of your mortgage payment because it is not deductible and subtract out the deprecation we listed above.

Subtract expenses and vacancy rate from Gross Revenue to get to Net operating income before debt service.

.$210k less RE commissions and closing (6%)= 197,400 less rehab 10k= 187,400 less insurance 500 and less property taxes assuming 6 months to resale 800 (total 1300)= 186,100  now less 6 months of payments (assuming 20 yrs at 5% is 1154.92/mo) $6929 of which 2600 is for principle so subtract interest of 4329 and you have total left of 181,771.

Value the property as if it is preforming to market and then subtract the costs and risks to get it there. 

After $140K you should start subtracting a standard gross profit from the ARV before you subtract the repair costs.  

So the only way they will meet your 3x requirement is if you subtract the $1,050 voucher from the $1200 rent leaving $150.

Should I pay the lien and subtract that amount from the sales price or how would you guys handle this situation?

If you want to wholesale you need to subtract your wholesale fee as well.

You have to assign your down payment an interest expense at 8% and subtract that from your cash flow before you get your CoCR.Good luck!

Or is this subtracted to get just the rent section of the FMR?