Posted by John (TN) on October 10, 2003 at 23:02:41:
Here’s the link I meant to past earlier:
http://www.creonline.com/mobilehomes/wwwboard4/messages/32283.html
First Moble Home Deal - What to do? - Posted by Dan
Posted by Dan on October 10, 2003 at 19:43:20:
I am a REI dealing with sfh - I received a call from one of my tear offs and it is a guy w/a moble home and here is the info I have:
1997, 16x60, 2/1, to include all appliance’s
Owes: $19,000.00
Will Take: $15,000.00 - maybe less
Worth: the only # he has is his tax assesment which is $26K
He is VERY motivated - he has already purchased a home and has moved into it making the MH vacant.
The MH park does not allow renters and his attmepts at selling have not brought any luck. He just wants to get rid of it.
I did get a suggestion of doing a Subject 2 w/the owner paying the $4,000.00 short and then selling it on a lease option - my question to that is can you lease option into a mh park.
Any other idea’s?
I appreciate your help w/this.
Dan
Re: Do you like hot tar? - Posted by Phil Pelletier
Posted by Phil Pelletier on October 11, 2003 at 01:03:20:
If you would switch places with a man sinking in a hot tar pit, then you are encouraged to buy that mobile. I apologoze for the flip answer, but the previous poster hit the nail with his head:
Toss out almost everything you know about Real Property when dealing with mobiles.
The reason your man is “highly motivated” (always a good thing in the REI business, but a fact of life in today’s meltdown mobile market), is he is terribly upside down in his loan to value. His motovation comes from his realization that his credit is going to tank when he gives that home back to the lender and takes the credit hit for the next few years.
You cannot help him.
There is no money in it for you, because of the fundamental “X” factor, the Great Equalizer involved in mobile investing:
The coaches do not hold their value over time like Real Property.
They do quite the opposite. Similar to an automobile, they depreciate rapidly, creating a ski-slope of a curve in relation to the loan you are about to inherit.
Even if you could assume the loan (not possible in most cases in this cool mobile-lending climate), the coach (the actual mobile is known as a coach to many seasoned investors) is currently worth about half of what is owed, and will be worth about half that again in 5 years. Soon, you will have a very small home worth about $5,000, with a loan balance in the $13,000-$15,000 range. Plus, you will be under the hammer of a ground rent payment every month the place remains unoccupied (and it will be unoccupied at some point, you can count on that).
At least when a SFH is between renters, your mortgage payment contains some deductable interest, some depreciation for tax advantages and the possibilty of the protection of equity in the property. Ground rent goes up in smoke, every month.
If I have scared you away from that home, so be it. However, mobile investing, REAL mobile investing, is a blast if you do it right. I recently paid $3,000 for a double wide, took a $500 down payment, a $1,000 “work off” note, against a sale price of $22,000 over 52 months. In the same park I bought an 82’ double wide for $1,000 in cash and I have two people willing to pay me $2,000-$3,000 down and $400/month for 48 months. Not THAT is cashflow! Not that I am bragging (I would list my screwups, but I only have 240 megs of RAM), but mobile investing is all about buying for cash and selling over time. Hopefully you recover most or all of your costs in the down payment, then you just soak it up each month on the positive side.
It’s fun, but it is a very specific skill, and it all starts with a book called “Deals on Wheels”. Buy it at a website near you!
Phil Pelletier
Re: First Moble Home Deal - What to do? - Posted by John (TN)
Posted by John (TN) on October 10, 2003 at 22:38:11:
Dan,
First, welcome. I just realized I wasn’t being real sociable by just pasting you a link 
Do be careful. I too have a sfr/duplex background and they are great. Still have my (very) little RE empire and don’t plan on letting it go.
Mobile homes are an animal of a different stripe. Be ready to toss out a bunch of what you already know about REI. Some of it applies, but read Lonnie’s books and read this forum for a few months before doing anything.
Best of luck,
John