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Step 2: Computing Your Offers

After you have computed your Adjusted NOI, select the Offer Generator tab. Notice that the Deposit Amount and Net Operating Income are taken from the Net Operating Income screen. Although these values come from the Net Operating Income screen you can manually change the values here (For example you may want to lower the NOI amount for you initial offer so that you have room to negotiate). If you do manually adjust the values, the values are valid for this screen only. They do not carry back to the Net Operating Income screen.

After you are satisfied with your Deposit Amount and Net Operating Income amount, you can customize your financing options (found within the Financing Options panel). The default financing is via a bank for 100% of the NOI value. The financing options range from 3% up to 10%. You can customize the financing options to whatever your liking and for whatever you can conceive. To edit an existing financing option, select a financing option from the table of financing options and click on the Edit Financing Option button. For example, if you selected the default Bank financing option the following dialog box appears (Figure 4):

Figure 4: Editing an Existing Financing Option


To change any of the values, select the desired field and enter a new value. When you are done, hit the Save button. The changes made are reflected in the Financing Options table. If you wish to delete a financing option, select the option and click on the Delete Financing Option button. You will be prompted to verify that you wish to delete the option. If you select Yes, the financing option is removed from the Financing Options table. In order to add multiple financing sources (such as seller financing or third party financing) to derive your desired NOI value, click on the Add Financing Option button. The following dialog box appears (Figure 5).

Figure 5: Entering a New Financing Option


You must enter a value for each field within the Finance Wizard dialog box. The Financier Name can be any name you wish. The Percent Financed must be a number from 1 – 100. Please note that the sum of Percent Financed for all of the financing options must be equal to 100%. The Minimum Finance Percent and Maximum Finance Percent must also be a number from 1 – 100. Once you are satisfied with the financing option, hit the Save button and the financing option appears in the Financing Options table.

After you have completed choosing your financing options, you can select the number of years to finance the property. Your choices are 5, 10, 15, 20, 25, and 30 years. By default, all loan terms are selected. If you don’t want a particular term, uncheck it. Likewise if a particular term is not chosen and you wish to consider it, check it.

Now that you know how much you can pay per month (your adjusted NOI), how you would like to finance the payments, and the length of time you wish to finance it for, you can determine how much you can pay for the property. To do this, click on the Calculate Offer button.

For each financing option there is a corresponding tab in the Offers panel containing a tree of the chosen financing terms. Double clicking on a node of the tree expands it displaying the principal and financing rate in increments of .125%. Choose the finance rate you desire by selecting it. Once selected the chosen offer appears in the Current Offer table. If you choose a different offer from the same financier, the existing chosen offer is replaced with the new chosen offer. The Total Offer (the summation of the deposit and chosen offers) is displayed below the Current Offer table.

Once you are satisfied with the offer you have generated you can store if for future reference. You do this by clicking on the Store Selected Financing Option button. If the offer selected is valid you get a message letting you know that the offer has been successfully saved. If you did not choose an offer from each financier, you get a message letting you know the financier who you have not selected.

You may continue with this exercise saving as many different financing options as you wish. Remember it is important to create the correct deal for the seller in order to buy the property at your desired wholesale price.

Figure 6 shows an example of the Offer Generator screen with multiple financiers:

Figure 6: Offer Generator


Step One: Computing Your Net Operating Income


Step 3: Generating Your Offer Letter


The Cash Flow Tab

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