Posted by Ernest Tew on October 06, 2003 at 05:46:29:
Dusty, you can download the Net Lease and Option forms that we use from my web site, www.ErnestTew.com
You will find other useful forms and articles with valuable information that you can download without charge.
Some advice please… - Posted by dusty(fl)
Posted by dusty(fl) on October 04, 2003 at 22:02:49:
I have found a mobile home/land for sale. The owner is 50+ years old and he just can’t keep the place up anymore. He just wants out. He is leaving all appliances, all furniture, and a 3 ton A/C that is 2 years old. It is a 2/2 about 4 years old. He owes $28000 to American General and (he says)it’s not assumable, and there is a $1000 penalty for early payoff. It is on a 1/2+ acre lot, and this is included in the price.
Now I know that is a lot of money, but I think there might be a way to make some money here, but I just can’t see it. Do any of you have any advice that might help?
Thanks,
Dusty
You vision is 20-20. You haven’t shown us any… - Posted by Dr. Craig Whisler CA NV
Posted by Dr. Craig Whisler CA NV on October 05, 2003 at 09:35:37:
…profit yet. And that is what this game is all about.
First question if you are trying to make money is to figure out what this place is worth. Until then we can’t even begin to advise you on whether it is or could be a good deal for you.
Sometimes sellers owe more than the value of what they are selling. They are VERY motivated (to dump their problem on anyone who comes along). Sometimes there is a great deal available. The only way to tell the difference is to learn what it is worth vs what it is priced at. As to the $1,000 prepayment penalty, I bet the seller would pay it if you asked him to. But don’t get too excited if he says yes. You still need to determing value v.s. price. You must buy wholesale and sell retail to make any money. The real question then is, can you do that?
I like Ernest Tew’s ideas. If there is a good profit in this deal then I would go the route he has outlined for you.
Regards, doc
Re: Some advice please… - Posted by Ernest Tew
Posted by Ernest Tew on October 05, 2003 at 05:15:36:
Dusty, if after checking into your local market and looking at a few comparable sales, you conclude that the price is right and the payments aren’t too high, you might offer to enter into a net lease with an option to buy.
The lease payments could consist of making the payments on his loan and paying all expenses involved (maintenance, insurance, taxes etc.).
Your ‘down payment’ could be treated as option money consideration and the price when exercised could be the loan balance at that time.
You could then sub-lease the home and land (for a higher monthly payment) and sell an option to buy, charging a larger amount for the option.
We sometimes enter into similar transactions when a person in our park wants to leave but we would like to keep the home in the park.
However, it is important to protect your interests in such transactions by having the right forms completed and signed. You will need a good Net Lease form. The Option Agreement (for the land) should be recorded on the public records. A Deed to the land should be signed by the owner and held in escrow. And, a Power of Attorney authorizing you to sign anything related to the mobile home should be signed by the owner.
If you aren’t experienced in these matters, you should have an attorney handle it for you–at least the first time.
To save some money, I could provide you with the lease and option forms that we’ve used for many years. All the necessary forms are included in our manual, “How To Get Rich Helping Others.”
Re: Some advice please… - Posted by Steve-WA
Posted by Steve-WA on October 04, 2003 at 23:55:36:
what’s he want? 5K top walk away? 10K? Possible sub2 here, or get it on a L/O. I would probably consider pursuing the sub2 route - keep making those payments for him, you take deed, he keeps mort in his name.
there’s a little more to it than that, but it’s one good way.
Re: Some advice please… - Posted by Dusty
Posted by Dusty on October 05, 2003 at 19:09:28:
Thanks for the advice, and I would really appreciate the forms.
When I talk to him next, I will update you.
Thanks again,
Dusty