Posted by Hank on April 01, 2004 at 13:52:10:
Believe it or not, I really mastered the basics quite a while ago, the reason I considered using Wade Cook’s method for mobile homes #1 is because since mobile home price ranges are lower, there are many priced at 15k and under, therefore it is easier to maintain a proper debt ratio(meaning the percentage of every dollar of assets that represents liabilities) . Example, the debt ratio should be kept under 65%,meaning if you had a 100k receivable contract, your underlying encumbrance (payable) should be no more than 65K., if you bought a mobile home for 8 to 15k and created a 10k equity contract that debt ratio is only 60%, 60% looks better on your financial statement.
But if you’re into stick real estate with higher price ranges, its harder to maintain that ratio, if you buy a property for 40k and up, example a 10k equity contract on a 40k property is a debt ratio of at least 80% (50k receivable 40k payable) that ratio is too high. 400k in assets vs 100k in liabilities looks a lot better than 400k in assets vs 300k in liabilities( thats a bad liabilities to asset ratio, especially if there was a dip in the market.
The other reason #2 I consdered mobile homes for Wade Cook’s method is that you can avoid banks and lenders and do a lot of deals in less time, since you would not have to wait for bank qualifying, and you can borrow on the income stream of the equity contracts, or use them as collateral on other deals. As Paul Simon ( equity sharing guru ) used to say you could put deals together as long as train smoke.
Wade Cook’s - Posted by Hank
Posted by Hank on April 01, 2004 at 10:39:42:
Has any one of you ever read Wade Cook’s book HOW TO BUILD A REAL ESTATE MONEY MACHINE, for those of you who have read his book, I have a question for you, have you ever tried out his program on mobile homes, or manufactured homes? Did the program work,were you able to create equity contracts? —Any reply will be appreciated.
pssst . . . - Posted by Steve-WA
Posted by Steve-WA on April 01, 2004 at 10:57:44:
Hank, while there may be a way to twist real estate principles around these tin cans, why reinvent the wheel?
This discussion board is built around the topics in that one little, homemade, how-to manual that has changed the lives of an empire.
Re: pssst . . . - Posted by Hank
Posted by Hank on April 01, 2004 at 11:10:53:
I know that Lonnies book is the best book for mobile homes, I have read all of his articles, and I will be buying his DOW book very shortly theres a book store a few blocks down the road , but I have always enjoyed trying to expand my horizons with new ideas.
Won’t find Deals on Wheels in a book store. (nt) - Posted by Jeanne
Posted by Jeanne on April 05, 2004 at 12:41:52:
Well here is a new idea for you. - Posted by Dr. Craig Whisler CA
Posted by Dr. Craig Whisler CA on April 01, 2004 at 12:37:05:
You aren’t ready for expansion. You haven’t mastered the basics yet. You don’t usually work on 4, 5, & 6 until you’ve mastered 1, 2, & 3 first.
Beam me up Scotty, I can’t deal with so much Hank-y-Panky from Mayberry RFD.
Master a few spokes before you attempt to tackle a wheel.
When you finally become a wheel, just remember to watch out for dogs.
Hank we all love you. You ARE wonderfully persistent. We are just having a little fun at your expense. Gotta pay your dues yaknow.
Wade’s stuff could theoretically work for mobiles. The real question should be WHY would you want to do it in the first place?
Have you ever heard of the KISS method of keeping things simple? What you are talking about is a simple wrap, but wraps work best when you have a fully assumable senior encumbrance. These went out of general supply rapidly after the 1978 Bank Of America VS Wellenkamp decision that held that due on sale clauses in home loan docs were valid and enforceable.
Furthermore you would have to deal with the thorny problem of trying to use a real property deed to wrap a personal property loan. How and where would you perfect it through recording? I am not aware of ANY regular mobile home lenders who fail to include due on sale language in their loan documents today.
Re: Well here is a new idea for you. - Posted by Hank
Posted by Hank on April 01, 2004 at 14:39:58:
Dr. Craig Whisler
Thank you for that point about trying to use a real property deed to wrap a personal propery loan, since no bank is involved, If I do it without a wraparound it may work, or me and my consultants will have to come up with another way, perhaps, seperate notes and mortgages instead of wraping. Thank you for that important point.