like say 20-30% of the selling price is gross profits or net profits?

Not every property will have operating expenses of 50% of gross rents.

We believe if a person(s) become efficient at intelligently using OPM and OPR the rewards will be greater and faster than most people can fund using only their individual "employee income".

The 50% rule simply says that throughout the United States, operating expenses run 45% to 50% of the gross rents.Here's how I would evaluate your example.Gross rents: $600Operating Expenses: $300NOI: $300Less $100 desired cash flowMaximum mortgage payment $200Therefore, with a 30 year loan at 7%, the maximum acquisition cost (purchase + rehab) would be $30,061.51 and as you said the max purchase price wouldbe $28, 061.51.Mike

Assume expense (including capital items and vacancies) are 50% of gross scheduled rents.

I know I can split my paycheck however I want for direct deposit.Does this work with bank accounts that don't belong to the employee?  

These are derived from Gross Operating income.

If you hire a property mgr who charges 10 percent of gross rent and 1/2  - 1 month rent for lease up it is going to be closer to 12 percent over time

(If rent grosses $1000/mo, then they will allow you to count $650/mo as "income" to qualify).Am I missing something, or is it just a great option that HAPPENS to exist because I live here...?

So let's look at a simple example:Purchase price: $200,00025% Downpayment: $50,0002% Closing costs: $4,0004.5% 30 year fixed rate mortgage: P&I = $760 / moLet's assume gross rental income is $3,000/mo (1.5% might be reasonable in Philly?).