Posted by Jerry Greer on May 21, 2000 at 22:00:47:
I agree with my fellow investors from Ohio. It really isn’t a big deal at all.
Ps. Kris and John, Can’t wait to get together again.
I hope you can join us Scott.
J Edward Greer
Changing Strategies - Posted by Scott_OH
Posted by Scott_OH on May 16, 2000 at 19:43:43:
I’ve been reading the posts for about a week. I’m burned out from landlording and flipping junkers and tired of dealing with moronic code enforcement people.
I’ve bought Lonnie’s books and I’m ready to put my big toe in the water. I shouldn’t have a problem negotiating for deals (I’ve bought houses for as little as $750), but I need to know what the rules are for MH’s(for Ohio).
Do MH’s fall under the lead paint statue?
Do I need a dealers license to do my first deal?
Are MH deals and notes taxed differently than flipping houses (I wholesaled for cash, never did a note)?
Can you do these deals inside of an IRA or Roth and ‘slide’ the taxes?
Thanks to all who have shared their knowledge on this board. I’m looking forward to doing my first deal.
Scott
Lead based paint disclosure - Posted by RobertR CO
Posted by RobertR CO on May 18, 2000 at 20:08:02:
Scott,
I thought that Mobiles fall under the same federal lead based paint disclosure requirements that affect the sale of stick built homes.
Just to cover myself, I have buyers sign the disclosure form that I prepare.
Cordially,
RobertR
Where do you live? - Posted by Karl (OH)
Posted by Karl (OH) on May 17, 2000 at 06:48:15:
Scott,
Where in Ohio? I’m in Cincinnati. There are a few other guys around the state doing Lonnie deals, (don’t worry, competition is NOT a problem). Get in touch if you want to join our little network. We’ve even got a lawyer in the group.
Karl Kleiner
Re: Changing Strategies - Posted by Lonnie
Posted by Lonnie on May 17, 2000 at 06:24:37:
Hi Scott,
I’ve never had, or heard, of a lead paint issue come up with a MH. Probably because there is very little paint in the older MH’s. Most of the older homes have wood paneling. Unless it’s been repainted with lead paint, there’s very little chance of a lead problem.
Every state has different regs on dealer licenses. Some states allow several transactions without a licenses, others don’t. Check with DMV, or who ever handles dealer licensing.
If you buy and sell MH’s, you will be considered a dealer and all taxes on your profit are due in the year of sale. It’s the same with houses.
You can do this inside your IRA.(Not sure what you mean by "slide the taxes). Mid-Ohio Securities (Dick Desich) can give you all the info on using a IRA.
Best wishes,
Lonnie
Re: Where do you live? - Posted by Scott_OH
Posted by Scott_OH on May 17, 2000 at 08:14:04:
I’m in Lima. I am aware of no competion in the used MH market in this area. Quite a few of the parks are low income rental nightmares with no onsite managers.
When I first started buying and selling houses, I was the competition. Now there are about 10 people chasing the same properties. Unless you stay in the really cheap stuff, the deals were getting few and far between (LaGrand type deals).
The REIA group is mainly composed of Section 8 landlords and landlords in general. I left because of the whining and complaining and generally negative attitude.
If you have another meeting set up for Ohio MH investors, let me know.
Off to the BMV to get the regs…
Scott
Re: Taxes - Posted by Scott_OH
Posted by Scott_OH on May 17, 2000 at 08:16:38:
By ‘sliding’ the taxes I meant to shelter tax free until a much later time.
If deals and notes can be snowballed (allowed to grow)tax-free, I would be very much interested in the process.
Scott
Dealer’s Licence - Posted by Karl (OH)
Posted by Karl (OH) on May 17, 2000 at 14:42:18:
If you went down to the BMV and picked up the requirements to get a dealer’s licence, you’re probably freaking right now. I think in Ohio if you sell more that six “vehicles”, you need to be a dealer. I understand in our state they require you to have a sales lot for your mobile home inventory, an office thats not accessible from inside your house (external entrance with no inside door), and a few other requirements that would keep most of us from ever getting started in this business.
My understanding is that these dealer regs are really designed to keep people from selling used cars out of their front lawn. They’re written to protect legitimate used car dealerships from getting squeezed by an individual down the street with a bunch of cars for sale and no overhead taking away all their business. Since we’re not competing with new home dealers (actually we help them by buying their trade-ins), we probably won’t have anyone complaining to the BMV.
The few of us in Ohio are operating under the premise that the BMV won’t care about us not being dealers due to the real purpose of the dealership requirement. I don’t know if they track how many titles an individual transfers, but if they do you could put six in your name, six in your wifes, a few in each kids name, etc. And if they eventually decide its a problem, I believe the first time they just issue a warning. Thats when you claim ignorance and say “gee, do I need a licence?” By then your business will be up and running, and you can handle that decision when you get there.
Karl Kleiner
Re: Dealer’s Licence - Posted by Art in WV
Posted by Art in WV on May 19, 2000 at 09:50:38:
I received WV dealers requirements in the mail and they are very similar to what you describe. Bottom line, it would be impossible to do what I see described in here within those regs. How does your group handle sales tax? Do you pay it on each sale and consider it a cost of business? Or, is it possible to use Lonnies power of attorney form: seller gives me poa, I hold title till I sell the MH then sign it over to buyers who pay the sales tax. Will this work?
Re: Dealer’s Licence - Posted by JHyre in Ohio
Posted by JHyre in Ohio on May 17, 2000 at 15:37:33:
Karl is correct on all counts. One of our number asked the DMV about this and they said “Don’t worry about it”. Several of us asked prosecutors whether they would litigate such an issue- and they just laughed. They have better things to do than break ground by enforcing over-broad statutes never meant to cover our (harmless) activities. And the first offence is a slap on the wrist under the statute itself. When I first got on this site I was VERY concerned about this issue, because as an attorney, I did not want to put my license at risk. I needn’t have worried, at least not in Ohio.
John Hyte