Posted by JR on March 04, 2002 at 17:33:53:
I was doing some digging in the archives about back lot rent. I noticed you said you are not liable for paying it. Could you give me some insight on the subject. I would appreciate it. Thanks. JR
Mobile Home Lot Rent - Posted by Mike
Posted by Mike on July 01, 1999 at 07:46:17:
We are considering purchasing our first “Lonnie Deal” mobile home. What happens when the note payer pays his check to us, but doesn’t pay the lot rent and backs out of the transaction? Are we then responsble for paying the overdue lot rent to keep the mobile home?
Those of you with experience in these types of deals…Do you have your notepayer write the check to cover the costs of the note payment, lot rent and insurance to you and then you know the costs are covered?
By the way… if we only do a few deals a year…do we still need a Dealer’s license in Michigan?
Mike in Michigan
Re: Mobile Home Lot Rent - Posted by Sheik
Posted by Sheik on July 01, 1999 at 07:53:22:
I have an agreement with the park owner. If my buyer does not pay the park rent i am liable (you may be able to negotiate differently with parks in your area). When/If my buyer does not pay the Park rent the Park Manager immediately notifies me and I take whatever action is necessary.
Regarding insurance - Have your buyer put you on the insurance as “loss payee”. If your buyer lets the insurance lapse, you will be notified by the insurance company.
Sheik
Mike:1 one way to work the State dealers License - Posted by LenWa
Posted by LenWa on June 26, 1999 at 20:11:53:
Mike:
In my state you are allowed to sell 6 vehicles a year (mobile homes) are regulate as a personal vehicle.
So I could sell 6 and be within the law— my wife could sell 6-- and I have 4 sons all over 21 that can each sell 6. So to keep my investmet cost down and see if I really want to do this full time I could in theory sell 36 mobile homes and be with in the law. (hehehe with a big Tax mess to figure out in Dec.) Anyway don’t let the thought of having to get a License to start Lonnie deals stop u from trying. If this is the area of invetment you want to go with. Ask what the state regs. are in your state ----- bet they could tell you where u buy your car plates and yearly tags. This worked for me and I will be getting my license here in WA. to make myself in compliance with our laws. Hope this helps.
LenWA.
What if they don’t pay the space rent?..Who does? - Posted by Dirk Roach
Posted by Dirk Roach on June 26, 1999 at 12:11:34:
Hi Mike,
Welcome to the wonderful world of Mobile Home Investing.
As to your above scenario here are a couple of things which I do.
I DO guarantee the park space rent, as a lien holder. I find that it is a super bargaining chip as far as getting people into the park. While others application may get scrutinized mine just sails through.
Also this keeps me in super graces with the park. Because they know that no matter what they are going to get paid, after all that’s what they are in business to do, collect rent from their lots.
Of course it sounds to me that you are worried about putting someone into your investment which won’t meet their obligations.
Simple answer don’t. That is easy to say, but we all know things happen and come up.
There are a few techniques which you can utilize to hedge your “bet”, so to speak.
If a person has edgy credit, here are few things which I use to make me (and note buyers down the road if I choose to go that route) more comfortable:
a.) I put a clause in the contract which says that if they default in their contract with the park I can start repo proceedings. I also get a copy of that agreement, along with a copy of the park rules and regulations, every time. Really good to have if you ever sell the note.
b.) Co-signers are Great! I love to get mom or dad or grandma on the hook if son or daughter does not pay. People rarely want to mess over their mom.
c.) Target markets like the military. Scott (AK) made an excellent post a week or so ago about this. Soldiers, Sailors, Airmen, and Marines lives can be complicated when they do not fulfill their obligations. Honor is very big among the military. (As it should be with all of us)
Work with people. Remember that these folks that you are selling to are NOT USE to people treating them like people. Ask them what type of payment schedule can they realistically handle. If paying you on the 15th is better for them, then collect your payment on the 15th. If paying you out of every check is good for them then do that. Happy people pay!
Also keep informed with the parks you deal with. I personally go to great pains to establish a relationship with the parks that I deal with to let me know if they are even a day late. Believe me that is a super asset.
As far as insurance goes, again I have developed a super relationship which an insurance agent which handles all of that for me. All I do in fact is call her up with their info and the address of the home and the insurance is set up right there on the phone. I am always put down as the lien holder on all my insurance policies. And she always breaks down the insurance so that is either a monthly or quarterly payments. The bill and information is sent right to the mobile home. As lien Holder I am always kept abreast of their situation. Also Shelly (my insurance woman) always keeps me in good supply of calendars, to do note pads refrigerator magnets etc.
Not sure about the dealer laws in MI (sorry) but there are plenty of folks doing these in various areas of the Great Lake State so I do know that they can be done.
Good Luck
Dirk
Re: Mobile Home Lot Rent - Posted by Freddy Wells
Posted by Freddy Wells on June 26, 1999 at 24:09:44:
As a note holder in the state of Oklahoma, I am not liable to pay the delinquent lot rent. However, the type of Lonnie deals that I am doing, I will pay it anyway and go after the deadbeat with a garnishment on the money I pay out on lot rent. It has been cheaper for me to pay the lot rent because my other choice is the park will make you move the mobile home and that expense will be higher than the delinquent amount owed most of the time. I have never had to pay because I have screened them pretty close before they get into that home. Your contract should also have a clause that says “Failure to pay lot rent or abide by park rules makes the loan go into default”. That phrase alone will save you a lot of headaches.
Good Luck