Mobile Home: Opportunity or Nightmare - Posted by Walt -FL

Posted by John (WA) on December 10, 1999 at 11:25:45:

There’s nothing there. All you would be doing is making her probelm yours.

Mobile Home: Opportunity or Nightmare - Posted by Walt -FL

Posted by Walt -FL on December 10, 1999 at 10:40:17:

OK REI vets a potential newbie needs some advice-

I have a work associate who wants to relocate to Montana, and patchup a relationship. Her dilemma is this: Has a MH in Florida she would like to get rid of plus a few $ for moving expenses. It’s a 1986 Fleetwood 14’ x 70’ 2b/2b. Some extras include 4’ privacy fence, fireplace and covered carport 14’ long. She owes 23k and was told(by a salesperson at the trailor park)that the unit is only worth 15k. Loan payment $290, lot rent $263. Is this an investment opportunity or something to stay away from? She certainly is motivated, but how much I don’t know, yet. How do I find true value of MHs and how are loans constructed? From my understanding they are not true mortgages, so could I assume her loan and market the unit on my own? Have been reading this site daily for a few weeks and have seen some solid advice given. Any direction for would be greatly appreciated.
Walt FL

Re: Mobile Home: Opportunity or Nightmare - Posted by Jacob

Posted by Jacob on December 14, 1999 at 22:01:42:

Run like the wind, my friend. This is a good example of excitement over a potential first deal, and wanting to help someone out. I can tell you from experience, you will literally find dozens of these types of situations. People who owe way more than their MH is worth. This is due to the fact that MH’s are cars (Ithink FL requires a license plate, if not mistaken;) and therefore depreciate quickly. According to my trusty NADA guide, $15,000 is probably a good RETAIL value for this home, meaning as an experienced investor, I would pay no more than $8500 or so for it. THIS IS NOT A DEAL FOR YOU. Please trust me and the others around here who do these deals. You will find plenty of prospects if you are serious about being a mobile home investor. This is a pitfall, not a deal.
Feel free to contact me if I can help you in any way, advice or whatnot. Good luck.

Re: Mobile Home: Opportunity or Nightmare - Posted by SL-VA

Posted by SL-VA on December 11, 1999 at 22:40:27:

23k for that mh is definitely way too much! If you buy it, you’ll take over not just her loan payments, but her problem as well.

However, it doesn’t mean that this is the amount you’re going to settle with. If the owner is very motivated, let her know that you can only help her with part of that amount.

As for the value of MH, just as cars, it’s hard to say. My past buyers would probably go crazy if they know the difference between my purchase price and theirs. However, the difference is that I make purchase with cash and they don’t. Their focus is on affordable monthly payments and they don’t really care what their final purchase price is.

Know how much people are willing to pay monthly for the MH under consideration - a popular measuring rod is monthly payment plus lot rent should equal equivalent apartment rental in the area (I find that to be fairly accurate in my area). Use that to determine how much you are willing pay for the MH.

After a few deals, you’ll have an idea of the range of your purchse price and sale terms.

If you’re serious about Lonnie deals, buy Lonnie’s books and start with a MH that’s much less than 23k.

Re: Mobile Home: Opportunity or Nightmare - Posted by JHyre in Ohio

Posted by JHyre in Ohio on December 10, 1999 at 14:54:50:

The loan balance is much too high for you to make a profit by assuming it. In my part of the country (Ohio), I’d pay @$2,000 to $4,500, depending on condition.

John Hyre