Episode 127: How to Calculate Wholesale Offers

In this episode, David and Mike talk about making offers to motivated sellers. They discuss the MAO formula to figure out what to offer on a Property.

MAO = ARV x DISCOUNT RATE (70%) – REPAIRS

MAO Formula is the number that you want to get to in the end or hopefully stay below. But, that doesn’t mean that is the actual number that you will offer since there are still negotiations.

Mike and David ended this episode with an encouraging quote “You make your money when you buy. You get paid when you sell.”

Definition of Terms:

MAO – Maximum Allowable Offer

DISCOUNT RATE – set to 70% by default

ARV – ACTUAL REPAIR VALUE (actual value after you repair)

Watch the whole video to learn more!