Is this a good deal?

Bird Dogs, Wholesaling
1

I have a seller who is willing to sell her house for 400k cash.
She wants to cash out on 50k and will carry the rest. The house needs to be rehabbed. The estimate for repairs is 150k and the ARV is between 650 k - 850k depending on how extensive you get with the rehab. Does this sound like a good one to put under contract?

Joyness19

2

Howdy Joyness19:

You want to be at 70 to 75% of your ARV to have a good deal. At an ARV of $850,000 you have a good deal if you can keep the total costs to less than $600,000. If you can only get $650,000 you will have trouble.

Another question is how will you finance the $50,000 and the repairs. If you have to use hard money you will only be able to borrow 70% of the ARV and it will be expensive too.

I did not really help much but it sounds like it could be a good enough deal to get under contract and then investigate further and get bids etc on the rehab. No sense doing that much work without getting it tied up.

LOL

3

hello joyness19,

study these figuries and see if you can use them,

                       ARV    + 650,000
        minus repairs    - 150,000
                                + 500,000
   minus your profit    -  50,000
                                + 450,000
    minus Realtor %    -  40,000
                                + 410,000
   minus closing fee     - 10,000
              your offer   + 400,000

you choose the lower ARV so you can sell sooner and easier. varify with a title company the closing cost. obtain signed contract from seller with subject to repair cost varification (3 contractor estimates). varify the repair cost with other estimates. if estimates are higher, re-negotiate lower offer. advertise to sell during rehab trime. hopefully, you sell without a realtor and you pocket 90,000 instead of 50,000. feel free to change the figures for your purpose. good luck, birddoggenjack

4

Thanks, I will use those figures.

Joyness19