Calculating Master Lease to Purchase payments? - Posted by Lokesh

Real Estate Investing Real Estate Financing
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Posted by Lokesh on December 22, 2008 at 13:56:49:

Thanks for the response. I am assuming that you calculated this using the rule of thumb - total rents must be greater than 1% of the purchase price ($150,000).

This property is in somewhat upcoming area and I want to make an offer that is good for me and honestly I am willing to walk away from the deal. If I make an offer of $5000 down payment and $750 monthly payments with 50% of the monthly payments applied to the purchase, then will it be a good deal (for me of course)?

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Calculating Master Lease to Purchase payments? - Posted by Lokesh

Posted by Lokesh on December 19, 2008 at 13:26:59:

Hello,

What is the best way to calculate lease-to-purchase? I maybe asking some stupid questions here :slight_smile:

For example there is duplex:

Purchase price: $150,000
Taxes: $4800 (so monthly tax is $400)
Total Rent: $1,200

What are the reasonable initial deposit and monthly payments for 4 years lease?

Can we purchase the duplex anytime in the next 4 years or we have to wait for 4 years?

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Re: Calculating Master Lease to Purchase payments? - Posted by brandoncbsre

Posted by brandoncbsre on December 22, 2008 at 11:22:23:

I will answer this the only way I know how…

Do NOT buy this property! It cant possibly cashflow without putting a ton a cash down. Look for deals that will cashflow. That is the only way to buy if you are looking to hold for any length of time.