Owner Financing Deal

[Corey Diethorn]

Hi BP Forum,

I am thinking of making an offer on my first owner finance rental.

Terms:

Long term tenant 6 plus years

Rent $700

Transitioning neighborhood, brand new beautiful new construction 180 units subsidized housing across the street.

Asking 37,000

Offer

5k cash

200$ month on a five year payment schedule ($12,000 over course of loan) - balloon due at end of 5 years. Total amount due is $20,000

Through my calculations

Expenses:

$125 a month property tax

$75 a month insurance

-----

Variable/Sink Fund costs

$189 - prop mangment, rainy day fund, vacancie

Total Expenses

$389

$200 payment

= $589

----

Cash flow = $111

I should be able to bump rents by $25-50 a month immediately.

I will need to do about 1,500 in repairs to the sofit/fascia

Thoughts