How do I apply a lien to an unrelated asset? - Posted by Burley Boy

Posted by Philip on September 26, 2003 at 12:10:26:

Good deal! Show your wife every check, even if it has to be reinvested. And show that business account’s balance every time it goes up.
Philip

How do I apply a lien to an unrelated asset? - Posted by Burley Boy

Posted by Burley Boy on September 25, 2003 at 12:22:23:

Thanks to Lonnie & Ernest. Their nuts & bolts instruction has allowed me to “take the plunge”.

I’m finalizing my first two deals in a couple of days and have found a turn key deal “thanks to a suggestion from Lonnie in his book.” I asked the potential seller if he has any parties looking at his MH that could not obtain financing, but are committed to purchasing from him. At the time he did not, but called me back a week later with a couple that loved his trailer but were having difficulty due to a BK. I have verified employment/income and feel comfortable with this potential buyer except for the BK. They do not have anyone that can co-sign, so if they walk on my, I’m held holding the bag.

My question is this:
How do I go about placing myself as a lien holder on an owned asset, such as a vehicle. This will give me the added security that I may have some recourse if they choose to default.

Thanks!

personally - Posted by Philip

Posted by Philip on September 25, 2003 at 20:02:49:

from a new guy’s point of view…I would especially check the employment record. Talk to SEVERAL co-workers and bosses that were not given as references. That is what I have done on my 4 deals and with my parents sfh’s.
How big of a deposit/down payment are you getting?
Philip

You’ll be sorry - Posted by Dr. Craig Whisler CA NV

Posted by Dr. Craig Whisler CA NV on September 25, 2003 at 13:19:21:

In the case of your lien on the mobile home you go to whatever agency in your state handles mobile home licensing and have yourself listed on the new title (when you sell it) as the lien holder and ask that the title be mailed to YOU not your buyer.

If you are going to take a lien on an automobile just go thru your state’s DMV and do the same thing.

Burley Boy, I think that this isn’t your real problem. If I may be allowed to put in my 2 cents worth, maybe you should condider the following:

Take care when your buyer can’t get a cosigner. The motor vehicle isn’t a very practical remedy because its hard, dangerous, and costly to repo cars. Old cars often have blown up motors by the time you get them. If it is worth $5k or more and dfree and clear it may be good additional security. Don’t fall prey to the old argument that his $50 car may not be worth much but it is good security because he MUST have a car to get around and he can’t aford to lose it.

I would pass on this buyer, or at least wait a while and try to find someone who can get a co-signer.

Most folks have friends, a boss, brothers and sisters or parents who could cosign for them. Remember cosigners don’t make the payments unless the buyer doesn’t. It isn’t much risk for the cosigner, if this guy pays his bills. Do all of these people know something about your buyer that you don’t? If none of them trust him enough to co-sign for a measly loan of $10k then you shouldn’t either.

You have a tacit warning. Now I suggest you check his credit record, income source, and EVICTION record, to see what kind of guy you are dealing with.

I think you will be sorry if you deal with this guy, without more protection.

If this deal goes bad you could be out 4-6 months payments for your mobile, 4-6 months space rent, extensive rehab costs (because everyong facing a foreclosure or repo hates the one doing the forclosing or repossessing). In addition you could have legal costs and some friction with the PM because of the problems.

Often new investors are so worried about having to pay a month or two space rent that they fall victim to temptation to take a weak buyer just so they can save on another month’s space rent. Sometimes they are simply desperate for the downpayment to have money to live on. I’ve made this mistake many times myself. My check book has the scars to prove it.

I wonder if the PM would even approve this guy?

An ounce of prevention is worth a pound of cure.

Regards, doc

Re: personally - Posted by Burley Boy

Posted by Burley Boy on September 26, 2003 at 07:28:45:

I’m getting a $750 deposit (10% of purchase price). I’ve been able to get a mother to co-sign. The mother doesn’t have stellar credit either, but at least the maternal influence to pay their bills “so she doesn’t have to” may exist. The park is owned by a large corporation that is fairly stringent with criteria to get approved. They were just approved yesterday afternoon and are ready to move in ASAP. I’m meeting with the seller today to purchase and the buyer on Tuesday.

AS a side note, Lonnie is so right about your relationship with the PM. With his help, I just negotiated a '93 double wide for $2500. It’ll fetch between 8-10K+. My wife’s getting nervous that I’m liking this too much and not focusing enough on my real JOB. :slight_smile: