MH's....A few questions for the pro's - Posted by PatB(AL)

Posted by Ben (NJ) on February 06, 2000 at 15:23:40:

As I detailed in a prior post,I almost got rooked this week by a SERIOUSLY inflated appraisal. I was going to make a loan based on the appraisal value when comps and a property inspection revealed a value of less than ONE HALF what the appraisal stated. This could NOT have been a mistake. It was a scam. It occurred to me that others on this site may have encountered other scams and their stories could prevent others (especially newbies) from taking a beating or even complete financial devastation. My lesson learned is to order my own appraisals rather than relying on borrowers to provide them. If you have a story that could benefit others, let’s hear it.

MH’s…A few questions for the pro’s - Posted by PatB(AL)

Posted by PatB(AL) on February 04, 2000 at 03:09:41:

OK, Here it goes??my first post.
I purchased Lonnie’s book from this site and CONSUMED every bit of it and went back for seconds! After reading the book I started watching the papers and hitting the local parks. WOW?. I honestly think this market is completely untouched. I spoke with several PM’s and explained what I was “doing” and they said that they would have no problems working with me.

I have also completed the necessary “due diligence” pertaining to local laws, reg.'s and market (Tax %'s, Licensing, Comp’s, etc?etc…). The people at the county courthouse were extremely helpful and polite. It’s amazing how easy it is to get information if you just ask the right people. With that said, here are my questions for the people here at this site:

  1. -I have found out that MH’s in this state purchased new before 1990 do not require a title. They are simply bought and sold with a Bill of Sale and the last years tax receipt. How do I go about financing a sale to a buyer and still show a 1st mortgage lien on the MH without a title?

  2. -Although there are several MH Parks in this area, there are also many more parks within 25 to 30 miles of my home. I own some rental property and I know that it is not a good idea to be a “long distance landlord”. Does the same hold true for financing MH’s?

  3. -I plan on doing a few deals before I form a true “business”. I have done some research on LLC’s and Corp’s (spoke with my accountant and a lawyer) and plan on establishing one or the other. I am interested in knowing what type of business the other “Mobilers” have set up?

It’s only been about 2 weeks since I got the book. I meet with my first seller tomorrow. This was a lead from a PM that said the owner offered to sell the MH to them so he could upgrade to a new 3BR (owner has 2 children and another on the way in a 2BR home). Spoke with him on the phone and he is very motivated. He even offered to leave the W/D, furniture, TV, and Dinner Table! We’ll see?..

Thanks in advance for your response.


Re: MH’s…A few questions for the pro’s - Posted by Lonnie

Posted by Lonnie on February 04, 2000 at 09:43:09:

Hi Pat,

If you don?t have a title, then you would use a UCC-1 document for the security instrument. Check with your Clerk of Court, or someone familiar with using one. We have titles on all MH?s here, so I?m not that familiar with UCC?s.

I would check out all the parks within 30-45 minutes of my house to see which ones I wanted to work in. (I wouldn?t consider 25-30 miles to be “long distance”). Then meet and talk with the managers, in person, not by phone, and see which ones will work with you. The park manager is the most essential person to have on your team, so you have to cultivate a good relationship with them. And they are the ones who will furnish you the best leads on deals.

As for what entity to use, read and study everything by Bill Bronchick. He has many excellent articles on the “How To Articles” section of this site. He also has a Q & A section. And if you?re at the Convention, you will have the chance to ask him in person.

Welcome to a money making business and best wishes,


Re: MH’s…A few questions for the pro’s - Posted by Michael

Posted by Michael on February 04, 2000 at 13:01:02:

Lonnie, I just purchased your first book and have visited several parks in my area. Most of the ones I have visited so far all require any MH older than 10 years old to be moved. A couple of exceptions are in really bad condition. Do you have any methods of getting around this with the owners/PMs?

Other owners are doing this themselves (buying and selling exclusively…all sales in the park must be moved). One park owner told me to get lost! He has had lots of problem residents.

Demand for MHs is tremendous here (Birmingham, AL) and older ones older than 1980) can be found easily, but must be moved…most parks have no or only a couple of spaces available. I can see lots of potential…and I ran a sample ad for a MH for sale, owner financing and have a buyer’s list as long as my arm, but no homes to put em in!

How much should I expect to pay to have one moved? I am guessing 1800 - 2000 for moving, blocking, levelling, tying down, electrical and plumbing connections…anything else involved?

Have you ever developed a new park or known anyone who has? Seems that the biggest obstacle would be getting zoning approval.

Thanks for any comments/input…still trying to get that first deal done…I have a $3000 honeymoon to pay for in May!!!

I’ll be out again tomorrow morning…trying again.

Re: MH’s…A few questions for the pro’s - Posted by Lonnie

Posted by Lonnie on February 06, 2000 at 08:39:10:

Hi Michael,

Supply and demand for the lots usually dictate the park policy. When there is a big demand for lots, as in your case, the parks can be real picky and some will take advantage of the opportunity to upgrade by kicking out the older homes. The reverse happens when there are plenty of vacancies. So you have a good and a bad situation.

If you?re the seller, the bad news is that since the home has to be moved, it?s much harder to sell, and a much lower price. But as a buyer, you can make some excellent deals if you have a place to move it to, and the price for purchase and moving is right. Keep looking for a park that will take the older homes, and see if you can make the numbers work to your advantage. But before you do, check with your Building/Zoning department to see what?s involved. You will need permits, inspections etc by the City inspectors. Also check with several movers for the cost of a move and re-set. In my area, the cost runs between $2000-$2500 for a complete job.

While buying one that has to be moved can be an excellent opportunity, I don?t recommend you start off doing this on your first deal. It can be very expensive, frustrating and time consuming. You could easily get turned off and discouraged. Get a few simple deals under your belt first and then see if you want to do it.

As for developing a park, I think you would be much better off to buy an existing park, rather than developing a new one. It would, or should, be much less expensive with a lot less frustration. Personally, I would never have the patience to go through with what it would take to develop a new park. Let somebody else fight City Hall, then buy the park when the owner is burned out or wants to retire.

Don?t let a few park managers discourage you . Keep looking until you find a manager that will work with you. You only need one park, one manager and one deal to get started.

Good luck,


Re: What Happened? - Posted by Lonnie

Posted by Lonnie on February 06, 2000 at 11:23:30:

I posted an answer to Michael?s question “MH?s, a few questions for the pro?s” and it shows up under Bens(NJ) post “Suggested question of the week”. Michael, if you?re looking, here?s my post.