Posted by Tony-VA on March 09, 2000 at 20:50:32:
First things first. Wait for the books to arrive.
As for pricing, you will need to learn the market. What does a comperable apartment rent for? Use that as a ballpark for the monthly payment (including lot rent). You will use lonnie’s techniques to negotiate the downpayment, then just work out how long to run the note. Everyone is different. I run my notes 36-48 months. Whatever this would come out to becomes my sale price. The price will vary based upon the terms we negotiate.
When I began lonnie deals, I was advised never to spend more than $3500. It took awhile before I could even find one for under $5000. Once you start speaking with truly motivated sellers, $2500 quickly becomes the max. Most are purchased for much less than that.
We make our money going into these deals by buying right. Don’t let For Sale sign figures fool you. That price means nothing. That sign may have been in the window for 6 months. The may be 3 months behind on lot rent. They may have bought another home and are paying two lot rents. Finding the seller’s motivation is what determines the price. For you first deal, I would suggest you use the comperable monthly payments and $500 down to give you a figure to keep in your head (do not tell this to your buyer). Once you have this price, divide it in 1/2 and know that you will never, ever go over that price. Trust me, these cheap homes are out there, but if you convince yourself that cheap homes in your area go for $5000, that is exactly what you will find. If you convince yourself that you can buy them for 1/2 of that or better, you will find them too.