Mr.Tew Thanks for the information. Its similar to what Wade Cook teaches in his book “How to Build A Real Estate Money Machine” He teaches how to avoid being called a dealer when buying and selling on installments, and how to be taxed only for the amount you receive.
Soon I will purchase the book “Deals on Wheels” I have heard that its a very good Mobile Home book. I read about your system “Get Rich Helping Others” I know that it is excellent–I plan to purchase it, I like all the documentation, and MHP information that you provide. The info that you give out on these creoline sites is the best.
Is it necessary to use special documents for mortgages, or notes for mobile homes?
Or do you need special paper work similar to chattel morgages, or other non-real estate.
I would think that the only thing that would matter is the verbage describing the deal, am i correct?
Re: Mobile Home Buy & Sell Documents - Posted by Ernest Tew
Posted by Ernest Tew on August 06, 2003 at 05:15:33:
Joe, you can use notes when dealing in mobile homes but it isn’t the best way. And, unless the land is included, you wouldn’t use a mortgage.
When you buy mobile homes for resale, you become a dealer in the eyes of the IRS. That means that the entire gain is taxed in the year of sale–even though it may be collected over a period of years.
A better way is to enter into a net lease with your customer and have a separate option, giving them the right to buy. But, if these documents are not prepared exactly right, it could still be deemed to be a sale by the taxing authorities. When this happens, you could be required to pay the back taxes, together with interest and penalties.
We have developed a net lease form and an option form that solves these problems. The forms have been used for several years by people around the country. If you, or any of the readers, would like to receive a free copy, send me an email.
However, it will be a few days before I can respond because I will be out of town between August 7 through August 15.
Hi, I am looking for a way to not have to pay the taxes all in the first year on the sale of a mobile home while financing it. for example, buy for 3,000, sell for 7,000, carry a 6500 note. The Parks ALL require the title to be transferred into the buyer’s name. Is there a way? Thanks! Mike