Posted by Blane (MI) on March 30, 2000 at 08:30:24:
Hi Jeffrey,
As I said to Blake, each park has it’s own set of circumstances, so should be viewed as it’s own business system. I also think some parks are concerned (maybe overly obsessed) with their “image.” One park I was at doesn’t let dealers buy at all, only people who will live there. I could finance a deal, but who only wants to make 15%? Another park won’t even let sellers put For Sale signs in their windows. Yet another park is now requiring all metal-metal homes have a roof and siding put on them by buyers, otherwise the home has to be moved. This I think automatically eliminates Lonnie deals in this park. I understand the desire for nice parks, but sometimes I want to say to them come on, this isn’t Aspen, Colorado, you’re downriver from Detroit!
But as I said, these are just hurdles to overcome. There’s parks out there where we can do business and do well, we just have to find them.
i have recently read deals on wheels. i was all excited about investing in mh’s in my area. i have had no problem locating mh’s. however, the ones i located were in parks where either the mgr. or the owner wouldn’t allow this type of investing. please help with any suggestions.
Posted by Blane (MI) on March 30, 2000 at 08:18:49:
Hi Blake,
I had a similar problem when I started, and got some good advice here. Are you approaching PM’s as an individual, or as a business? At first I was approaching as a person wanting to buy in order to sell to someone else. The common PM response was that the MH’s had to be owner-occupied, thus if I was buying it, I’d have to be living there. I then began approaching PM’s as an employee of a business that buys and sells MH’s, and seemed to do better one-on-one with them, especially since they’d dealt with other MH “dealers” previously.
Other good advice I got here was not to go in all prideful about this new business I (we) had started. Being humble, pleasant and mindful of what we could do for them helps get that initial conversation off the ground. As Ed Garcia always says, the STREET is the best teacher, so keep on truckin’ with the PM’s.
Try not to get discouraged, or if you do, work yourself out of it. This is gonna take some time and effort. I’ve had several pleasant chats with PM’s, but I still haven’t “found” that one park yet where everything comes together. PM’s won’t take referral fees; not one yet has been willing to refer any sellers in the park who may be motivated to sell. Another park told me flat out if a dealer buys it, it has to be moved. Another park has $400 lot rent (sheesh!) and is so strict residents I talked to want to move. Each park has it’s own set of circumstances. It does seem part of the problem is so many parks in my area are corporate operations, and the PM’s are clear that their bosses are strict about how to deal with folks in the business. I too may have to start looking farther away from the metro Detroit area. But it’s just another hurdle to overcome. I do believe this is a business that we can succeed at and set us on a path to financial freedom.
Why won’t they allow this ? - Posted by Jeffrey Short
Posted by Jeffrey Short on March 30, 2000 at 06:58:14:
I have been reading DoW and think that this is the way for me to “finally” start REI. However, I have a question…
What objections have park owners/management used to not allow you to do Lonnie Deals in their parks? I mean… you are just buying/selling a MH, what is so “evil” about that?
This first two parks I went to, I got that kind of resistance too. I sort of thought these Lonnie deals wouldn’t work in my area like the book said it would. That was about 8 months ago.
Every visit to a park manager or owner, I always remember them saying ‘they didn’t want anything to do with it’. It seemed like they didn’t want to be involved.
After the conference in Atlanta, I went back to one of the parks and explained to the park managers that I would be buying trailers in their park for cash, and financing the trailer to new homeowners that would meet their approval. I also offered the management to check my credit if necessary.
I explained exactly how the Lonnie process works. It was like teaching them how to do it themselves.
After clearing all of their objections, I was welcomed with open arms. This worked at both parks!
I got my first Lonnie deal FROM the park owners lead. Two 1970’s 3 bedroom trailers on a farmers lot for $2200 total! Lot rent is the cheapest in town!
I know what you mean about the managers refusing to work with you. You may need to go farther out toward the country (if you live in a decent sized town) to find some non-corporate owned parks, and then they might give you a better chance.
A lot of people on this site will tell you that you should take a number of meetings with each park manager before launching into your “program”. I think this may be a good idea, but it hasn’t worked for me. Most of these parks have stiff rules handed down by the corporate owners, and it’s a waste of time to try to get blood out of a turnip. Or maybe I’m not as good as Dirk and others, with the relationships. But I prefer the path of least resistance, i.e. keep visiting parks until someone is cool with you from the start.
Here’s another idea I’m trying now. I saw a MH that was advertised for $3500, but I was having trouble with the manager. So I told the seller to continue to offer the home for $3500, and call me if someone has $500 down and wants to make payments. Or try to get whatever cash deal he could for himself. But if he calls me to finance it, I struck a cash price of $2,300. The resulting note will yield around 90%, and the buyer won’t know what hit him.
In other words, avoid owning the home, let the seller sell it for you. However, your profits could be limited this way.