Possible First Deal, input appreciated - Posted by Allen (IN)

Posted by Kevin in OK on July 27, 2001 at 06:44:24:

Allen, there are several costs that need to be included in your assessment. It sounds like you would net $950 monthly, excepting of course the expenses for the property.

You said the rents include trash, water and sewer. How much are those monthly?

As rentals…another cost is maintenance of the MH’s (however this expense would go away if you sell the homes as Lonnie deals like Chuck suggests).

You said the rent also includes lawn care…who mows the lawn? If the current owner/seller does it, he probably won’t continue to mow it for you for free, so that’s going to be you or someone you pay!! Figure in either the cost, or the value to you as a part-time job.

And depending on where this property is…who removes the snow in winter?

You also need to figure in a management fee…the seller shouldn’t be working for free and neither should you. Whether you are going to manage it yourself or pay someone else to do the job, it’s a cost to be figured in. How much is the going rate in your area for property management? 10% of the gross? Allow for it.

Any common utilities you must pay…electric?

What is the value of the land only? How did you determine that? How much are the property taxes?

This may be a good deal…just some thoughts here on what you should be discovering while performing your due diligence. My guess is you will net much less than $950 per month.

(Oh yes, and if the MH’s are here in Oklahoma, find out who pays for cleanup after tornado season!)

Kevin in OK

Possible First Deal, input appreciated - Posted by Allen (IN)

Posted by Allen (IN) on July 26, 2001 at 21:44:26:

I have been a long time reader of the message boards on this site, but this is the first time I have posted a message.

I am in the mortgage and finance industry and an opportunity came across my desk today:

4 older mobile homes on
1 parcel of land

2 of the homes bring $300 per month
1 brings $350 per month
1 brings $450 per month
total of $1400 per month

The rent payments include lot, water, sewage, trash removal and lawn care.

The seller is asking $50,000 for all 4 homes and the land.

Now, I am new to this type of investing and I have come to appreciate the help and advice posted on this site for others. Any input would be greatly appreciated.

Thank you,
Allen

Re: Possible First Deal, input appreciated - Posted by Chuck (AZ)

Posted by Chuck (AZ) on July 26, 2001 at 21:58:59:

$50,000 @ 7% for 15 years
Your Monthly Payment will be - $449.41
Total Interest Paid over Life of Loan - $30,894.54
Average Monthly Interest over Life of Loan - $171.64

These were the best numbers that I came up with. IF you can get this financing (or better), you’d profit about $950 a month (or more).

If you sell the homes “Lonnie-style”, you’d profit even greater.