I don't think anyone can really tell you how to get the magic number, doubt even the seller knows sometimes.

There are countless inefficiencies and supply/demand imbalances which can be exploited.No doubt, as Jason said, there is money to be made investing your "private equity" into smal businesses that you have knowledge of (such as Joel mentioning buying a beaten-down restaurant franchise that will generate 60k of fairly passive cash flow).

I kept a running tally.LeverageSynergyLatest and greatestCircle backCore competenciesGod I hate corp America and I doubt I go back.

You can discriminate based on any past drug related conviction, no matter what it was, unless your state law addresses this differently, but doubt it.

They will need at least 10 % equity in the future value of the property, so you can fudge some if you think the value will increase, but I doubt it and would work off the sale price.Getting a premium price, I would look at 8 to 10 per cent.

If I just took over the property, I'd give him the benefit of the doubt.

If you have good credit and an income, you should be able to obtain a 70% loan on the real estate alone, but I doubt you will get much at all on equipment....used rest. equip. is almost 10 cents on the dollar.Another aspect might be finding another resturant owner and partner with them.

Based on the information provided I doubt you would have much issue with qualifying should you want to proceed.

@Joel, I'd have to agree with what you've said about offering the quality of work and not giving the doubt.

Originally posted by Jerry Rode:The 50% rule for rent comes into play right around the $2200 per month at a purchase price of $225k.Actually, I doubt that.If you could theoretically get 100% LTV on a $225K loan, given 50% expense ratio (including rent loss and capital expenses), you'd need to get a 30 year fixed mortgage at 4.25% just to break even.