Rehabbers and Financing

Rehabbing, Fix and Flip, Rental Properties
1

Hello,

When asking HML’s, they tell you your offer should be ARV x .70 - improvement costs - quiet cost = max offer.

Do all rehabbers use this formula, or does someone out there suggest a different approach?

I want my offers to be realistic for the deal, but at the same time competetive with other investors looking at the same property.

Thanks,

Paul

2

This is the formula I ask my clients to use to get a more accurate guage:

BPO = ARV - Rehab Costs - BHS Fees - ROI

Best Possible Offer
After Repair Value
Cost of Repair
Buy/Hold/Sell Fees
Investor’s Desired Return on Investment

Regards,

Scott Miller