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This program has been designed to return $200,000 dollars on a ONE TIME Investment of $25,000 dollars. The simplicity of this program makes it easy to understand and extremely profitable. You will be investing in three bedroom properties at 50% LTV (loan to value) including rehab costs. It is our position to find properties at a price of 20% to 30% of market value for us to profit. In the example below we will summarize how the program works.
• We will locate properties that have After Rehab Value (ARV) of $100,000 or more and we will purchase one property with a market value of $100,000. Your investment will be $25,000 cash and you will finance $25,000 for rehab costs for the property for a total of $50,000 (see A B & C) with a profit of $50,000.
• It is our intent to purchase 4 properties over the next 12 months to facilitate the return of $200,000 dollars, rolling over your $25,000 investment. After purchase and rehab of the properties, you then apply for an 80% loan on the two properties (see D) and use those funds to purchase the next two properties.
• We now have equity of 20% or $20,000 in the property, and $20,000 in profit (see E-F-G) our total profit is $200,000 for 4 properties (see summary).
In summary your initial investment of $25,000 has gained you a $200,000 return.
A. $100,000 After Rehab Value X 1 Properties = $100,000 ARV
B. $50,000 Purchase and Rehab Costs X 1 Properties = $100,000
C. $50,000 Profit X 1 Properties = $50,000 profit
D. 80% loan on $100,000 (1 Properties) = $80,000 Mortgage
E. 20% Equity = 20,000 x 4 = $80,000 Profit
F. $30,000 Refinance Profit (Per property) x 4 = $120,000
G. $80,000 plus $120,000 = $200,000
$25,000 Partnership Program
H. H.U.D. Rental income for a three bedroom property.
$1,500 per month
I. Yearly Income per Property
$18,000 per year ($1,500 x 12 months) X 4 Properties = $72,000
J. Yearly Expenses per Property
$8,000 Mortgage at 10.00% interest = $667 per month
$2,500 Finance, interest and associated costs for rehab
$ 500 Property Insurance
$ -0- Taxes (Government subsidy 10 year tax abatement)
$1,800 Property Management (10% of Yearly Income)
<$12, 800> Gross expenses
K. Monthly Cash Flow
$18,000 Yearly Income
<$12,800>Yearly Expenses
$5,200 Profit divided by 12 months = $433.33 per month
Summary:
$ 120,000 Refinance ($30,000 X 4 properties)
$ 80,000 Equity
$ 20,800 Income (4 Properties)
$ 220,800 Total Profit
(Return of original investment of $25,000)
(This program is for accredited investors only and is subject to risk in the current market and potential future market conditions. This is an example only and not a guarantee of future profit or income.)
Analysis & Summary
BARCELONA FINANCIAL, INC. Real Estate Development & Investments
513 East 1st, 2nd Floor
Tustin, Ca. 92780
Toll Free: 800-406-0271
714-505-0263 * 714-505-0706 FAX
Copyright © 2007 Barcelona Financial, Inc. All rights reserved
REHAB PARTNERSHIP PROGRAM - CLEVELAND, OHIO * DUPLEX PROPERTIES
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