Subtract your mortgage payment of $3,200 (5% mortgages, 30 years) and you are bringing in almost $9k/month.

Subtract the $20K investment of purchasing the NPN + $2K in attorney fees for servicing/documents on the high end and I've just netted $49,300/$22,000 = 224% ROI.I can take the $71K and buy 3 new assets now and then those three turn into 9 assets, etc....This is why I love the NPN business and not just traditional owner financing/lending.  

This is my PETIO system:  Property - do a quick estimate of valueEquity - use online and county resources to determine all mortgages and liens and subtract from valueTitle - use record title (not tax assessor) to determine owner of record. 

Take your ARV, subtract repairs and the amount you want to make on the deal.

Also realize that when you sell a property you will need to subtract 7-10% for all of the closing fees, agent commissions, etc.

For instance, when I'm calculating my expenses with the mortgage included and I subtract the expense from the rental income, I'm left with the cash flow.

From there some investors, to gauge their net operating income, will subtract 50% to account for operating expenses.

So if you will rent the house for $1500, you would subtract 30%, or $450, for these items.

It all sums up per column at the bottom.If I was guessing, one takes the gross rents and subtract all the monthly cost, plus rehab cost to see if the portfolio has postive cashflow each month after monthly cost and rehab cost.Just wanted to see if anyone knows about it, and is my assumption correct, or is there some other formula used to product results, like debt to service ratios resulting number, and creates a threshold they are looking for? 

Less than that, once you subtract out the interest since the last payment, all the cleaning and fixing costs to get it into condition where it will actually sell for "what its worth", and some of the buyer's closing costs you have to pay these days to actually sell a house.