Hans analyzes a potential subject-to deal with a community member using his Deal Evaluator software, in a "Deal or No Deal" breakdown. The property, a pending Texas home listed at $220,000 (estimated fair market value $215,000), has a $203,000 loan at 7.25% interest (originated August 2023, 30-year term, $1,376 P&I, $1,884 PITI) with $5,700 in arrears. Front-end costs include $5,000 to the seller, $6,000 agent commission, $4,500 closing costs, and $2,000 private money lender (PML) fees, totaling $17,500. Borrowing $33,000 at 1.75% monthly interest for 6 months adds $577.50/month, with holding costs of $14,558. Selling on seller financing at $225,500 (5% markup), 10% down ($22,550), and 9.5% interest yields $323/month cash flow. However, negative equity (~$10,000) and $15,000 net loss after down payment make it unviable for Hans, despite a 25% cash-on-cash return. A landlord might consider it for rental cash flow (~$300/month), but Hans deems it a "no deal" unless an equity partner covers the $15,000 loss, which the low cash flow can’t support splitting.

Watch at YouTube.com/Sub2Investor and check out Hans’ Deal Evaluator at https://www.sub2investor.com/!

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