Using simple formulas to make things easier

I don’t know about you, but in my business I am always using simple formulas and calculations to make decisions with. Some of them I copied from others, and some I have created myself. Often times when summing up totals, using percentages, calculating costs, etc.. , you can find a formula that works to help make decisions with. Here are some examples :

How to know what to offer on a property : ARV * 80% – repairs = highest offer (just an example, adjust your numbers accordingly)

How to calculate repairs: Square feet of house X $10, 15, 20, or $30 (depending on condition)

Owner finance price of a house based on rents : Rent X 115 = net price after down payment is deducted

What to offer on a cheap property that I want to offer seller financing with to create a note : Purchase price X 2 + 10k

Minimum sales price (for me) when selling with financing : Purchase price / .65

Highest LTV when using private lenders: ARV * 65% – repairs

0% financing offers to sellers: Asking price / 240 months = payment , or, payment x 240 months = offer price

I have some others, but these are the ones that we use the most. The point is, if you find yourself spending too much time making calculations, there may be a formula you can figure out to make it easier.

What formulas do you use currently?



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