Spreadsheet Buying Subto (Subject To) with the (BOMSTSLO) ™ Method
Here is what one of the new people I coach from Socal did with a property in Phoenix
I helped him find. He has taken his training seriously. It’s a Subto (Subject To) that I helped him buy “off market” and he chose to sell on a Lease Option. This also works in OH, IN and GA. I’ve broken it into sections so it’s a little easier to follow.
He is into it for a total $15,828 and nets $106,745 when all is said and done.
Using a traditional bank he would have a 20% down of $55,000 plus $3600 in closing so roughly $58,600.
That’s a difference of about $42,000 to buy a property. That is money he can use to buy the next one, and the next one. It’s 3 times as efficient to do the (BOMSTSLO) ™ Method
(BOMSTSLO) ™ Method "Buy Off Market", using "Subject To" selling on "Lease Option"
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Seller Bought |
Nov-21 |
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Purchase Price |
$275,000 |
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|
Interest |
2.65% |
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Down |
$9,625 |
3.50% |
|
|
Financed Amount . |
$265,375 |
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|
Principal & Interest |
$1,069 |
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Mortgage Ins |
$156 |
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Prop Tax |
$63 |
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Insurance |
$93 |
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HOA |
$0 |
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He takes over Loan and |
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He makes Monthly Payment |
$1,381 |
| . | |||
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Current ARV |
$300,000 |
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Seller Sold Subject To |
|||
|
Principal Current |
$252,455 |
||
|
Arrears |
$0 |
||
|
Cash to seller |
$10,000 |
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|
Real Estate Agent Fees |
$15,147 |
6% |
|
|
** No Agent Involved ** |
$0 |
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|
Subject To Sale Price |
$277,602 |
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| . |
| . | |||
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Cash to seller |
$10,000 |
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|
Closing costs |
$3,628 |
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|
Wholesaler Fees |
$0 |
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|
Marketing to find |
$2,200 |
||
|
His Cost to Buy |
$15,828 |
||
|
(He has reserves set aside of ) |
$5,000 |
| . | |||
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He Sells On Lease Option |
|||
|
Interest |
8.00% |
||
|
Current ARV |
$300,000 |
||
|
Lease Option Increase |
$330,000 |
110.00% |
|
|
Option Fee |
$33,000 |
10.00% |
|
|
Principal Optionee Owes |
$297,000 |
||
|
He makes Monthly Payment |
$1,381 |
||
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He gets monthly Rent |
$2,100 |
||
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His monthly Cash Flow |
$719 |
||
| . | ||||
|
Property Mgr (Don't need) |
None |
Optionee takes care of |
||
|
Repairs (Optionee does all) |
None |
Optionee takes care of |
||
| . | ||||
|
His Income From Property |
||||
|
Amount Underlying Loan |
$233,298 |
When Optionee Refinances |
||
|
3 Year Principal Paydown |
$19,157 |
Added To Profit |
||
| . | ||||
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His Profits |
||||
|
Option Fee |
$33,000 |
Cash into his pocket |
||
|
Back End |
$63,702 |
His Equity when Optionee Exercises Option |
||
|
12 mos cash flow |
$8,624 |
Cash into his pocket |
||
|
12 mos cash flow |
$8,624 |
Cash into his pocket |
||
|
12 mos cash flow |
$8,624 |
Cash into his pocket |
||
|
Gross Profit |
$122,573 |
|||
|
Cost to Buy |
$15,828 |
|||
| . | ||||
|
His Net Profit |
$106,745 |
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