Rationalization of the two most important acronyms in Real Estate by private money loans arizona

Welcome to Real Estate Investing Today brought to you by private money loans arizona. My name is Ryan Wright and today I want to talk to you about nyms. There are so many nyms like synonyms, synchronism, acronyms, I do know. I get them all confused. But basically in every single market there is this shortening of words i.e. acronyms that people use. I want to talk about a few of them.

One of them is ARV. ARV stands for After Repaired Value. So ARV is what the value of the property, once it is repaired. Most of the properties, as you are looking as real estate investor, are in need of repair and so if you want to find out you can look at current market value, which is probably pretty close to what you are buying for given the current condition. There is After Repaired Value that is the worth of the property, once it is in a fixed up condition.

Now there is AARV, which is Adjusted After Repaired Value, which is determined by taking the After Repaired Values, what the value of the property is; once the repairs are done and subtracting the cost of repairs. So if the property is worth $100,000 once it is fixed up, which would be the ARV and current value of the property is $70,000 which would be the current value of the property. For the AARV, you take your $100,000 after repaired value price minus the cost of repairs and lets say, the repairs are $10,000 that would give you a $90,000 Adjusted After Repaired Value. So, the Adjusted After Repaired Value is what the property is worth subtract the cost of the repairs to get into that type of value and it will ultimately gives you your Adjusted After Repaired value.

Now our friends at Do Hard Money.com, use the Adjusted After Repaired Value and then they will lend a certain percentage on that property. If it is a single family home, they will go up to 70%. If it is a condo or twin home or side-by-side, they will go up to 60% and the property has to be an entirely unique property. There is some discounted amount that they are able to go up to. So you can get up to 70% of Adjusted After Repaired Value.