Hi everyone this is the first property I tried to analyze. Every time I analyze a deal, the refinance is coming in upside down. What part of the numbers am I missing. Even though this deal may not be worth it, I feel like I am doing something wrong. Even when I lower the original purchase price of the property to $80,000, I still feel like my refinance value is where I am going wrong. Please help push me in the right direction.
I believe it's because you're putting 100% down in the purchase price. It does not account for a monthly payment. The refinance would mean a monthly payment, and so it effects your 50% rule negatively.