1st deal -am nervous - Posted by seldon

Posted by Ray (MO) on July 14, 2005 at 13:26:52:

We go through a broker who shops for it. Typically it’s progressive, Auto owners or Foremost.

1st deal -am nervous - Posted by seldon

Posted by seldon on July 14, 2005 at 10:02:14:

bought deals on wheels last week and read it through overnight.went out and found a 1971 12x60 well dug in at a so-so park, decent shape and lived in for the past 30 years.I can buy for $1000 cash,$150 per month lot rent.I know I can sell for at least $3300 over 18 months. my questions:what is fair interest rate for both parties? can this trailer be insured? is it cost effective? can this type of buyer be found who will carry insurance? is the risk/reward ratio good enough to sell without insurance?any advice? this is really a great website ,glad I found it. S

Re: 1st deal -am nervous - Posted by Marty (MO)

Posted by Marty (MO) on July 14, 2005 at 11:39:40:

everyone has different opinions on interest rates- some go by state usury laws, some (like us) just pull the number out of the air. interest is gravy, your profit’s in the spread… Typically we charge 12%. Before we finish the deal we inform the buyer that we allow the interest rate to be bought down 3% for an additional $500 down. We’ve had people opt for 0% financing. We were thrilled because we had an additional $2000 down.
If the buyer puts a good downpayment on the home, they’ll carry insurance. As lienholder, the insurance company will inform you if their coverage lapses. If they don’t pay, you can repo the home. We have a few that aren’t insured, because they’re old, we don’t have much in 'em, etc. This isn’t a great policy… even if you don’t have anything in the home, if it burns down you’ll be out a chunk of change getting rid of a toasted home. I wouldn’t carry non-owner occupied insurance on a cheap old home like this, unless your buyer is paying for it… it’s too expensive.

Re: 1st deal -am nervous - Posted by MichaelH

Posted by MichaelH on July 14, 2005 at 11:58:24:

What insurance company are you using?