Updated about 10 years ago on .
Check on Numbers for Lease-Option
I have a few leads that I'm going to make an offer to, and I would like to throw in a second option that doesn't require my financing. So I'm going to make a Sandwich lease offer where I will lease with option to buy from them...then do the same thing to my new renter. What's the equation I use to figure out my Max Out Of Pocket I can give them and monthly payment?
-=DEAL #1=-
ARV: $60k
Repairs: $10k
Rents for: $600/mo
(Current buyer owns all cash)
**Am I on the right track...**
Usually I have been using 10% for Management, 10% Repairs, 10% CapEx...so right off of the bat 30% ($180 in this case) gets set off...so I know I can't give him more then $420 ($600 - $180). Is this correct? What else?