Posted by Tony Colella on June 25, 2006 at 23:58:25:
American General is not a traditional mobile home lender. To the best of my knowledge they are nationwide and make loans on pretty much every kind of chattel (personal property type) loan out there (TV’s, car titles, furniture, etc.).
The local branch managers seem to have flexibility within certain guidelines (seems to be under $50k, good ltv etc.).
Again, you can’t just call them up or talk to the person at the front desk. This is a branch manager we work with who can make decisions.
Looking at 15 acres with 1985 2/2 14x66 MH with deferred maintenance and needs new sceptic. $40K. An hour from Dallas and 10 minutes from a fast growing town.
Plan: buy it, fix it, and Lonnie it at $250/mo for the MH and $350 lot rental. In a couple years, remove the old MH (ask the buyer to move) and put on a newer, bigger MH and sell it all for $80K-95K.
Question: What are the finance options to buy it now? I have about $7K in free (liquid) cash.
Options I’ve considered:
Owner finance (it’s an estate and they want cash)
HELOC (want to use my equity on another deal)
Local bank (what will they want down?)
Mortgage broker (will they do it?)
Hard money lender (pricy)
What are other options or considerations?
Re: Financing land/home deal - Posted by Tony Colella
Posted by Tony Colella on June 22, 2006 at 16:06:29:
We have successfully used all of those options to finance land/home deals.
The financing for the first deal is always the hardest. The financing for a mobile home deal is even a bit harder but is most certainly can be done both using creative investing techniques and the traditional bank financing.
Smaller banks are my choice on the buy side of the deal but whatever makes the numbers work and gets me into the deal.
One personal comment, I do not use mortgage brokers for a variety of reasons (mostly based upon poor experiences with unethical brokers) and more importantly I wish to remain the principle all the way through the deal. The lending relationship is what I need to achieve to make future business easier.
As for your deal you may run into concerns about the land being the greatest value of the deal and some non-creative lenders may want you to put more down. This is where you simply need to get creative and be ready to knock on more bank doors. You only need one “yes” so don’t be afraid to walk.
Tony, quick question? I had posted a similar question a few days ago, about L/H financing. Are there hard money people for this type of transaction. All of the HM guys I spoke with did not want to do this type of deal. If you know any HM people that finance L/H deals please let me know.
Re: Financing land/home deal - Posted by Tony Colella
Posted by Tony Colella on June 24, 2006 at 18:43:05:
I have done both private hard money deals and what I refer to as commercial hard money land/home financing (places like American General).
For the commercial type places, you have to get in front of a decision maker and (of course) the terms are tougher but if the deal works with their numbers then you make on real nice on the refi.
Private hard money for me has always come through people I have meet in person via workshops, conventions etc.
In most cases, their terms were much better because they are investors too and understand mobile home investing and how I work.
At all of our boot camps we have had folks who were investors and hard money lenders. I always hesitate to mention names as no site has been immune to scams and fraud so I leave it to the folks to decide on their own if they meet people face to face during networking and decide they can work a deal.
For what it’s worth, at our coming Boot Camp, both Lonnie and our speaker, Attorney Bruce Berger will both discuss how the make hard money loans.
Tony, thank you for the reply. I can not make this bootcamp, but I will be at the next one. We have been doing Lonnie Deals here in s. Florida, with the intention of getting into land home deals. I do have your land hand book and have read it. This deal just fell into our laps. We are basically purchase land and home 20K below assesed value. Here in s. FL that is an excellent deal. Anyway, I really appreciate your help.
Dear Tony,
Please excuse my ignorance. Is American General like Household Finance or is it another type of lender? I’m finding a lot of land/home deals all of a sudden.
Bill H. (TX) wdwildbill@webtv.net