First Deal: How to deal with Park Management? - Posted by BrandonT(So.IL/St. Louis)

import · January 28, 2002, 3:43pm

Posted by Tom (IL) on January 28, 2002 at 21:49:14:

Jeff,
I would repost this as a new thread if I were you.
Tom

import · January 28, 2002, 3:43pm

Posted by BrandonT(So.IL/St. Louis) on January 28, 2002 at 16:43:31:

Hey there,

I am an investor in the Southern Illinois area and have thus far done a couple L/O, Sub2’s, and am in the process of completing my first rehab. These are all on regular SFH’s but I’m here to ask about a potential deal that came my way on a MH.

Got a call on my ‘I BUY HOMES!’ ad in the paper and it’s a mobile home in a somewhat junky area. I suppose that’s irrelevant since we’re dealing with mobile homes anyway but let me explain. The home itself is in good shape, traditional single-wide, 2 bedroom, 1 bathroom. The owners father has just completed some electrical and flooring work on the interior and all in all its in good shape despite being a mid-80’s construction.

The owner is only asking $1700 and so obviously I’ve given this one more thought than the other random MH owner’s who’ve called me with 40-60K notes they wanted me to take over.

The problem is after I went to view said home, I called up the management and asked them a couple things. They don’t allow rentals, and they don’t allow owners who don’t live in the homes. The current owner still lives in the place and I’ve been fortunate enough with my other investments to be able to just write her a check for the home, but the management says to buy it I would have to pass credit checks, background checks, etc…

I think this would be a great Lonnie deal that I could resell and get some cashflow out of but I’ve never dealt with a mobile home and am not sure how to handle the management here.

I posted many months ago about another mobile home I was looking at locally in another park, it wasn’t as good of a deal but since the management in that park told me the exact same thing I didn’t bother to mess with that one.

Please advise,

Brandon Treat
Southern IL/St. Louis

import · January 29, 2002, 8:49am

Re: First Deal: How to deal with Park Management? - Posted by David (OH)

Posted by David (OH) on January 29, 2002 at 09:49:55:

Hey Brandon!

Long time, no talk. I still owe you lunch the next time I am out your way. I have not forgot. Maybe next month sometime we can meet a Lotta Watta, I will let you know.

How junky of an area you talking, dangerously junky as in don’t go in at night? Junkyness is a concern, even with MH’s. And there are some junky/war zone areas where you are that I would stay away from. As you have already found out, the nicest homes in the nicest parks are pretty much out of question for Lonnie deals, mostly due to the “upside down” nature of the existing loans. But you don’t have to go to the bottom of the todem pole looking for motivated MH sellers. Motivated sellers can be found in most parks. The key is to find a PM that you can work with. Everyone wants to live in a decent environment/neighborhood. If the area is a war zone, you will have more trouble finding a buyer, even with financing.

Here is an interesting post written last week about dealing with PM’s. It may be too late to employ this approach, or it might still work. I would recommend you make a face to face visit with this PM, it probably would go over better than a phone conversation. Also, do an archive search on these subjects, you will find a wealth of good info as the subject seems to come up every week or so.

http://www.creonline.com/mobilehomes/wwwboard4/messages/11865.html

Also, you may want to consider getting an option on this home for a month or so. Agree on a price, say $1700 (or less, nothing wrong with negotiation), and write an option for say a month or two. Run an add and see what you can get for it. If you don’t find a buyer, you are just out the option consideration (say $50 or so) and a newspaper add. Tony-VA has posted alot about this approach over the last several months. It is a stratagy I am trying to employ myself.

Talk to you later,
David

import · January 28, 2002, 4:10pm

Re: First Deal: How to deal with Park Management? - Posted by Chuck (AZ)

Posted by Chuck (AZ) on January 28, 2002 at 17:10:55:

Tell the PM your not going to rent it, but that your reselling it to your buyer - your just playing bank and loaning the money to them. The buyer will still have to pass the park’s background requirements, which are usually more than adaquate - and include credit/criminal background checks.

import · January 28, 2002, 5:30pm

Re: First Deal: How to deal with Park Management? - Posted by Jeff

Posted by Jeff on January 28, 2002 at 18:30:14:

Well… I almost had me a good one today but the park owner told me “No!!!” I was standing there in my police uniform with my car in the driveway. I tried to explain that I was reputable person, that I would personally guarantee the lot rent and that it was a very nice young couple wanting to buy it. She said “No!!!”. I told her I wasnt renting it, I was selling it and just financing it and could show her the paperwork. She said “No!!” I just don’t understand her reasoning… I said what if I buy it and move it, you’ll lose the lot rent. She said “NO!”. So I told her “have a nice day” and let quite puzzled Why would anyone not want to do this… especially when seller is going to guarantee everything?

Jeff
jeffj@notachance.com