What to do??? - Posted by littleguru

Real Estate Investing Mobile Homes & Mobile Home Parks
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Posted by Phil Pelletier on February 23, 2003 at 23:16:28:

Don’t panic. You are doing fine. You really need to have the patience of Death to succeed in this business, full or part time. If this deal doesn’t work out, there are more to come. Just take a deep breath and realize you have two things working in your favor, at least one in each deal.

  1. Seller A is motivated by the fact that, depending on they type of loan he is getting for his new place, he may need to get off the title of that mobile home in order to show his new lender he is no longer exposed to ground rent payments. That is a HUGE motivation to anyone who wants to bail on a mobile home. I would call him back an tell him “I just talked to a nice young family that needs a three bedroom place (these things are like GOLD in my area). They have no money to put down on a place (this keeps him from saying “Great, have them call me about buying my home”), so I am financing them at a huge risk to me, but I just need your bottom line number to see if I talk to them about your place or another home I looked at in the area.” Of course, how far you vier off the “total honesty” path is your choice, but I suggest having a reason other than “I want to buy your home” when you call back.

That is a great deal looking for a place to happen. Three bedroom single wide units are great and very rare in my area. A motivated seller should sell that place for about $3500 cash. They sell really fast for, depending on the year and condition, about $10,000-$12,000 on contract because families with three kids (five people total) are REQUIRED to have three bedrooms in the home (two persons per bedroom) here in Oregon. That home should move very fast, and for significantly above what a 2bed/1bath goes for each month. Stay cool and let him become motivated, but BE THERE WHEN HE IS.

  1. Deal B is actually a bit more difficult, in my opinion, because anyone who has been paying ground rent for 7 months does not properly undertand their situation. They have to drop their price dramatically in order to get any buyers for that home.

Also, having the note holder be a relative is an advantage for us.

If she owed $6500 to a bank, that is a HUGE cork in the selling bottle for her. She cannot sell it on contract to anyone, because she does not have the title and the loan is almost always non-assumable. She needs cash to satisfiy the note, to transfer title to the new owner.

However, oweing money to a relative (especially a mother) is a beautiful thing for us. I recently had a mother come to the rescue of her daughter when she owed $6400 to a bank for a home I wanted to pay $3000 for. Her mother called me and said if I would pay $3000, she would cover the other $3400, and the home would be mine. I gave her a little parting “request” and asked that the last month’s rent that her daughter paid in advance like 8 years ago when she moved in, be kept inforce to cover March’s rent when I take the place over. She agreed.

Bottom line is, Mother’s come to the financial aid of their children all the time. That family needs you to step in and stop the bleeding and make a fair cash offer ($2500-3,000 if it is really nice), and get them out of the ground rent payment. The mother probably has the title and the daughter can work on paying her mother off over the next 10 years, but they need to get out from under that home. It is no longer an asset, but a liability. The sooner they recognize that, the sooner they will deal with you.

Feel free to try the same thing about the “last month’s payment” deal. It always works in your favor, if in fact, the last month was paid when they moved in.

Sounds like you did great to find these two people. Keep it up. If you want to talk, feel free to call me at 503-709-8184. I am in Portland, Oregon

Nice job.
Phil

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What to do??? - Posted by littleguru

Posted by littleguru on February 23, 2003 at 22:27:28:

Hello all, I finally on saturday went to check out my first two mobiles. I was a little nervous but not to bad, it was because i didn’t know exactly what i was going to say.

A narrowed it down to these two mobiles-- the first was asking 6500 i checked it out. It was 3bed 1 bath brand new carpet looked pretty good to me but who am i to say. I was talking to the seller for a while trying to gage motivation.He is closing on his new house in a month. Good stuff! I tell him i work as an investor in the area a buy homes for cash and offer quick closings since i’m approved by the park.

I tell him i can’t pay your asking price now but call me back if you can do any better. I think this is where i messed up, i should have asked him his lowest cash price now with me in front of him-- Instead of handing him my card and leaving.

I did almost the same thing with a seller who is just as, or more motivated, an empty trailer for 7 mths. This guy was selling for his girlfriend. Asked 8000 said how negotiable on price is she. He laughed and said just make an offer. He told me she owes 6500 to her mom and thats what she’ll probally take. 2000$ drop!!i told the guy the same thing, call me if you can do better. I really didn’t say WHAT IS THE LOWEST CASH PRICE SHE’LL TAKE IF I CLOSE TODAY. This place looked almost new inside but sh!tty outside. I talke to this guy for a good 40 minutes. But in the end i really never asked thAT MONEY MAKING QUESTION. Was i ready to ask the question.

I feel like these are deals waiting to happen should i call them back in a while to see were they stand? What do i do? I don’t want to lose these cause it feels like everything happened just like out of the book!
Thankyou for any help…

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Re: What to do??? - Posted by Tony-VA

Posted by Tony-VA on February 24, 2003 at 06:18:35:

Phil,

You did fine for your first time out of the shoot. You were nervous about what to say before you went in. It is a lot like giving a speach. Anytime we feel like there is a point in that speach that we either feel is a hard sell or is hard to memorize, we tend to stumble there, even if we need not.

There will come a point in time when you simply blurt out “If I paid you all cash today, what would be your lowest, all cash price?” You will sit there while the seller reacts and from then on you will find that this one sentance makes you money and comes out easily.

On the first deal you did the walk away technique pretty well so I would just keep an eye on that one come months end (when lot rent is due).

On the second deal you have made a negotiating mistake that needs to remembered. Do not deal with the Boyfriend, unless the home is solely in his name.

When you set up the appointment, you want all parties on the title to be there (if at all possible). You do not want anyone using the higher authority on you. You do not want one spouse explaining that night how low a price he or she is selling the house to you.

You want to be in front of the title and those whose names appear on it. In fact, I suggest when you make the appointment that you ask if they have the title in hand and whose names are on it so they can all be there. You may view the home without them there but do not negotiate until they are present. You are giving away the advantages when you negotiate with someone who has no power to act.

Tony-VA