Lending for fixer parks - Posted by Gene

Posted by Tony Colella on November 30, 2004 at 21:20:15:

The lending opportunities will vary by the deal and by your personal credit, networth, cash flow etc. and how you present it all.

Creativity in deal structuring will likely be the key to making it all work.

First we need a motivated seller, not just one that Should be motivated.

Next the seller needs to realize that the park needs work and cash to make it happen. They cannot expect a bank to loan all cash on the property as is, at his price etc.

Get creative. Find out how much he owes. Find out what he really NEEDS. That is the cash you will need to find.

Hard money, or even a nice chunk of cash as a first mortgage from a bank that gives the seller all he needs (and maybe more to make it tempting). The seller then takes a second to get what the cash flow (after your profit and all expenses) can afford to pay him.

Rinse and repeat as necessary but the idea is (as Terry says…) to give the seller what he needs to walk away.

If the seller balks at taking a second, have a A-B offer ready (lower price, better terms, he carry’s more as a first etc.)


Lending for fixer parks - Posted by Gene

Posted by Gene on November 29, 2004 at 12:17:47:

I am looking to buy a mobile home park in Kern County CA. The owners all seem to want all cash or 50% or more down.

The parks I am looking at are under $500k and have low cash flow.

Any ideas??

Re: Lending for fixer parks - Posted by Gavin Wilkinson

Posted by Gavin Wilkinson on November 30, 2004 at 15:15:23:

I’m just north of you in Inyo County. What kind of deals are you seeing? Might be interested in a partnership.

My other thought is this. Everyone asks for large down, or all cash. You don’t know what they will take until you make offers. Find an agent that will work with you and be willing to make offers. If your agent says “They won’t take that” and refuses to write an offer, you have the wrong agent. I wrote an offer at half of asking price and got it accepted!

Re: Lending for fixer parks - Posted by Eli

Posted by Eli on November 30, 2004 at 09:50:20:

At first glance from what you have given, I wanted to say, WALK AWAY from this “deal.” Granted I know VERY little from what you have written and I am assuming everything.

If this is a good deal try a LOCAL bank or more owner financing, that is your best bet for a park that size.

Now back to my concern how low is low cash flow? If this thing isnt netting ATLEAST 40K a year then walk away unless there is a huge upside. I wouldnt touch it for less then about $60 or 70K but I doubt you will find that in Cali (that is why I left 2 weeks ago)

Re: Lending for fixer parks - Posted by Gene

Posted by Gene on November 30, 2004 at 17:13:53:

I have been making low ball offers, and the agents agree with me that the sellers need be more realistic…at least that is what they say when they are talking to me ;).

I am pretty good at negotiating and getting the terms that I want but I was wondering if there is any funding out there for these kind of parks…just so I had options to possibly use.

Ill just wear them down.

Re: Lending for fixer parks - Posted by Gene

Posted by Gene on November 30, 2004 at 17:25:27:

The cash flow is ok but there is a lot of upside. I am looking for parks that have all the infastructure in place but have been poorly managed, and have a lot of empty spaces.

I have been doing lonie deals and mh/land deals for a while and I want a fixer park that I can move homes into (and sell using terms) and increase the cash flow and the value of the park.