Posted by Dan (NC) on September 25, 1999 at 16:33:52:
People in my market are willing to pay more to rent a home than to buy one. There are lots of retailers offering low monthly payments, but not many rentals or lease options, so it’s mainly a market driven situation. As an example, suppose I had home that I could retail for 10,400 with 1K down, $250 per month for 48 months. It’s in a park with lot rent of $200/month, for a total of $450. I can rent that home for $550/month, and have a much bigger pool of customers. So I offer a lease option for two years, with 1K option money, and giving the buyer $50/month credit. The sales price, when they exercise their option, is $8200 reflecting their down payment and credits (I could inflate this some, but there’s no need). At $300/month, the note is for a little over 32 months. So I collect 54 months of $350/month instead of 48 months at $250/month. My contract makes the tenant buyer responsible for all repairs, but I cover insurance and taxes for the two year option period, which amounts to about $25/month. Assuming the TB follows through with the purchase, I collect about $5500 more with the LO. But most of my buyers never get that far.
Has anyone ever used Rent-To-Own ads to sell their mobile homes with any success? If so, which section of the paper did you run the ads, ‘Apts. for rent’, or ‘Houses for rent’?
Re: Good ads to sell ‘Lonnie Deals’? Anyone use ‘Rent To Own’ ads to sell MHs? - Posted by Dan (NC)
Posted by Dan (NC) on September 24, 1999 at 21:21:29:
I like lease options or rto’s on MH’s because I can increase the cash flow substantially, still get a decent down payment, and since I usually end up getting the home back anyway, it doesn’t matter whether I have a sales contract or a lease, but it’s a bit easier to get a rental back. I advertise in MH’s for rent with an ad that says “Don’t rent when you can own…, etc.”
Re: Good ads to sell ‘Lonnie Deals’? Anyone use ‘Rent To Own’ ads to sell MHs? - Posted by LennWa
Posted by LennWa on September 25, 1999 at 12:18:33:
Dan how do you get the parks to go for this, in my state the park managers will not let anyone stay in the mobile home that is not on the title or is closely related to the title holder. Like wife son or daughter.
How is title held in your state— maybe thats the answer. But the way you are decribing this, it would not work here in Washington.
Re: Good ads to sell ‘Lonnie Deals’? Anyone use ‘Rent To Own’ ads to sell MHs? - Posted by Dan (NC)
Posted by Dan (NC) on September 25, 1999 at 16:14:47:
I don’t put them on title until they buy the home. I also don’t tell the park manager that my tenant buyer is initially renting with an option to buy. I’ve never had a manager ask to see the new title, although one manager asked to see my sales contract, which I was happy to show him (it’s separate from the lease contract). I let the manager know that if there is any problem with lot rent, I cover it. I count on getting about two thirds of my homes back, whether they’re on a sales contract or a lease, and from that standpoint, it doesn’t really matter.