OfflineIf I'm right about this: When you find some properties in your area, and then find out the FMV. How do you come up with discounted price that's right for both parties? Lets say a home FMV 120K and they are selling it at 104,900. They owe 80k on the property. Now, we take every thing into consideration such as exterior and interior (roof,foundation,walls,doors,basement etc..) to come up with a repair cost sheet if their some at all. Another example:If the property was a REO and the FMV was 120K but and the bank was selling it at 'AS IS' for 80K but only has a 50K lien on it do we offer 30-50% off that 50k or what. Can some one help me with this one.
"I used to say, "Things cost too much." Then my teacher straightened me out on that by saying, "The problem isn't that things cost too much. The problem is that you can't afford it." That's when I finally understand that the problem wasn't "it" - the problem was "ME!"--Jim Rohn
ARV (After Repair Value)
multiply by 58% ( x .58) (depending on area and how hot your market is)
= total
minus repairs
= MAO (maximum allowable offer)
Example:
ARV = 100k
X .58 (you're building in your profit of approx. 5-10k)
----------
= 58k
Minus Repairs 10k
_____________
= 48k This would be your MAO. You would want to negotiate starting a little less than this figure to give yourself room for coming up in price.
KimmyJ
Press on...
If you subtract 58% from the 100k wouldn't that leave you with $42k, then after the $10k in repairs, your MAO would only be $32K?
Am I reading this wrong?
Brian
You are multiplying by .58 which gives you 58k. If you divide 58k by 100k then you get 58% of the FMV. I see why you thought that from my reply. I'll edit it. Thanks.
KimmyJ
Press on...
Thanks for the help Kimmyj
"I used to say, "Things cost too much." Then my teacher straightened me out on that by saying, "The problem isn't that things cost too much. The problem is that you can't afford it." That's when I finally understand that the problem wasn't "it" - the problem was "ME!"--Jim Rohn
I have a formula **** on a forum to help people with this same problem...
Click my name then go to track then look for the forum that says find the fmv and it has formula to calculate profit repair cost realto fee's if there's any and more check it out
I will never accept defeat there for I will never fail