My husband and I use Seller Contributions to improve ROI on our rental property purchases. I submitted a suggestion to BP that a box be added in the calculator that would accommodate this contribution and pull it into the final calculations. The BP Support Team suggested I also post my request here. Anyone else use this tactic and/or would find this useful? Thanks!
Are you using an excel based analyzer? Or are you utilizing the analyzer on the BP site? Also, why would you not simply reduce the closing cost number you are entering into the calculator by the amount of the seller contributions? It would have the same net effect.
If the seller contributions are greater than the closing costs, then subtract the seller contributions from holding costs. Basically you need to reduce your capital outlay, without changing the primary numbers of the deal.
If you are using an excel calculator and want it customized, let me know and I can add it for you.
Hi @Travis Loyd and thanks for the feedback. We use both the BP and an excel analyzer. Our excel sheet has a cell for the Sellers Contributions and your solution of substracting it from the down payment makes total sense. I would know why the down payment was so low but it wouldn't be self explanatory if I sent it to a lender. "Why isn't your down payment 20%?" One of the reasons for my post was wondering if other investors use Seller Contributions. And why they use them compared to why we use them. Seems like I get a lot of pause from transaction participants when I mention Sellers Contributions. Thanks again!
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