Need Help On A Lease Option
I currently own a home that I am renting out. I would like to do a lease option with the current occupants. The current house is a 2 bedroom 1 bath. I will be upgrading the house to a 2 bedroom 2 baths with a new kitchen, new bathroom, new flooring, new paint, new appliances and roof. I feel this is necessary since the house is all original since 1982. This is what I have come up with:
Current mortgage $59,000
Second mortgage $37,000
Rehab Estimate $24,000
Total Investment $120,000 $720
Current appraisal $138,000
After market value $180,000
3 Year Option
Monthly payment $1415
Option $6,500 (500 for application fee and security deposit)
Credit for down payment $200 a month or $7,200
Total price $202,475 (4 % appreciation)
Down payment $13,200
Price after term $189,275
Profit
Price $202,475
Investment $120,000
$82,475
$1415-200-720= $495 X 36=
$17, 820
Total Profit $100,295 (Give or take a thousand)
Please let me know if this sounds right or if I am missing something. I would appreciate the input.
Thanks
[ Edited by hubmers on Date 01/01/2008 ]
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