About the cost basis, it's based on the original purchase price, but you also have to subtract out the land value. 

If you are asking how much we can get, here is what Abbey Credit Union offers: They use 80% of the appraised value of our rental properties and then subtract loan balance, the number is what we can get for the limit of the business line of credit.

But when you are starting out focus on good rents (GRI), subtract accurate and realistic expenses to calculate an accurate (NOI) for cap rates.

Take the total appraised value, then subtract any mortgages or debt and figure out the “net”.

For example: My cashflow target is $200/mo*unit The property is 9-units with a listed NOI of $84,000/yTherefore, I would have $21,600 cashflow/y and debt coverage of $7000/mo (NOI/12mo)So if I subtract the cashflow target from the NOI (Ignoring taxes or including them for simplicity...), then I should have $64,400 in debt that the property can support per year.In this example, pulled from an actual posting on LoopNet, the asking price is $1.2M.

Which you can find here:https://selling-guide.fanniemae.com/Selling-Guide/Originatio...You'll notice ALL of the scenarios except if you have no housing expense, you are able to take your rents and subtract the PITI/expenses directly from the rent.

They're not nearly as high as you might think.Second, even after the fees and costs are subtracted, you can still get a higher credit line.

You could also add/subtract from that if you believe it needs more or less work.Having said all that, estimating rehabs in general, is one of the toughest parts of real estate investing until you have some experience doing it or a good contractor on your team.

NOI is calculated by subtracting operating expenses (such as maintenance, property management fees, taxes, insurance, and utilities) from the gross rental income.

Subtract your estimated percentages for maintenance, capital expenditures, vacancy, property management, taxes, and insurance.