mobile home values - Posted by Dean

Posted by bwhite-tn on May 05, 2000 at 19:41:16:

Not Lonnie, but look at this picture. Lonnie is a licensed MH dealer. He can loan all the money he has,
without the problems you refer to,as long as restructures and makes it part of the MH note.
Here is an example of mine. A guy bought a MH 18 mos ago. His car blew up and he needed to replace it. He asked me ,after checking the BUY HERE PAY HERE lots.
I told him I wasn’t licemsed car dealer or finance co.
He said I know but can’t you help me someway. I said sure we can re-fi your MH for enough to buy a get by car. He now gwts to send me a check for 36 more months instead 14.
Does this make sense? Didn’t break any rules did I?


mobile home values - Posted by Dean

Posted by Dean on May 04, 2000 at 18:11:36:

I am interested in getting into mobile home investing and was wondering what is the best way to determine the value on older mobile homes. Thanks

Re: mobile home values - Posted by lonnie

Posted by lonnie on May 04, 2000 at 21:03:39:

Hi Dean

This has been debated to death and there is no clear answer. It depends on the type and age of the home. In the older homes like I primarily deal in, and you’re carrying the paper, I think it’s best to simply learn your market and know what you can sell for. Once you know what the home can be sold for, and you’re willing to be the bank, then you will know how much to pay for the home.

But if you want to be cashed out with a bank or lending institution, then you have to learn, and follow, their rules. I don’t like banks, and I don’t work with banks, because I am the bank. So I make my own rules.

Also, if you cash out on a deal, you’ve lost the future potential for improving the note, and/or keeping a good paying customer. Once I get good customers, I want to keep them as long as possible. It’s easier to keep a good customer than find a new one. I do that by loaning them more money, help them move up to a better home, etc. There’s more profits in the financing, than the product. And less work.

Hope this helps,


a different question - Posted by d.henderson

Posted by d.henderson on May 05, 2000 at 08:12:46:

Hello Lonnie,
Thank you for taking the time to help all of us.
When you help your people move up to another mobile, how do you work that? I have both of your books, I missed that part.
Could you explain please, I’ve already had one couple ask.
Thank you,
Always learning,

Re: mobile home values - Posted by SL-PA

Posted by SL-PA on May 04, 2000 at 21:54:59:


Can you please explain more on “It’s easier to keep a good customer than find a new one. I do that by loaning them more money, help them move up to a better home, etc”?

What do you mean by “a better home”? A better MH?



Re: a different question - Posted by Lonnie

Posted by Lonnie on May 07, 2000 at 09:00:21:

Hi Dee,

Sometimes your buyer out-grows their present home, or just wants to move up to a newer/larger home. If they’ve been good people, help them find the home they want, take their home in trade, or help them sell their home, get additional cash, or wherever it takes to make the deal fly.

Check my post on the value of a good customer. A good paying, satisfied customer will put money in your pocket for many years. So focus on repeat business from your buyer, rather than just one deal, one check.

Best wishes,


Re: mobile home values - Posted by Lonnie

Posted by Lonnie on May 05, 2000 at 08:18:40:

Hi SL,

Finding, and keeping a good long term customer does more for your financial wealth, than a “one shot, one profit” deal. If you do one deal, you get one check. But a long term, good paying customer will make you payments for many years. So finding, and keeping a good customer should be the goal of any business, if they want to be successful. Otherwise, you will spend much more time and money recruiting new customers. Kind of like my barber. He cuts my hair like I want every 2-3 weeks. But let him scalp me one time, and he won’t see me anymore.

I don’t know about you, but I’m finding it harder and harder to find people with a decent credit history. I would guess that I wade through at least 12-15 calls before I get one that I’ll even take the time to show a home to. I don’t know if there are more irresponsible dead-beats in the world now, or if I’m just meeting more of them.

The BK laws are structured so that the debtor has all the rights, and the creditors have none. I can remember when it was very embarrassing, and humiliating if someone had to file BK, and they tried to keep it quiet. Now days, people seem to think it’s a status symbol. I had a call last week from a young woman, who didn’t sound like she was more 18. When I asked how her credit history was, she said “I just filed BK, and my lawyer said it would take about 90 days. Then I won’t owe anybody, anything.”

She was so happy and excited, you would have thought she had just won the lottery. I told her that she was mixed-up in her thinking, that she still owed the money, the only thing that changed was that she could use the judicial system to screw people of what she owed them.

Here’s a couple of case histories to explain the value of a good customer. I sold a MH to a couple 9 years ago. The home was, and still is, on my lot. I financed the home for 3 years. When the note was paid off, they wanted to borrow some money. The man said that he could get the money from his bank, but he would rather do business with me. After asking him what the bank would charge, I let him name the amount he wanted, interest rate, and monthly payments. He dictated his own terms, based on what he had been told by the bank, and my yield on his new loan was 23%. He gave me the title back, I gave him a check, and it was a “done deal”. And I didn’t have to leave my house to do it.

He’s now paid that loan off, plus a lot rent payment every month. Now, he wants me to find him a newer home. I just checked my files on this one good customer. Over the past 9 years, he’s paid me over $38,000 in MH payments and lot rents. What if I had simply done a "one shot deal’ with this man, made one profit, and only got one check. How much would I have lost.

Last December, I mailed some of my best customers a notice offering to loan them money if they needed any. Only made one loan out of that mailing, but it’s another monthly check. But who knows what I may generate in future business by letting my customers know they can get money from me, instead of a bank.

And two months ago, I had one customer that needed to borrow $2,000. I made her the loan, added it to her MH note, restructured her payments so they were affordable, and I have another happy, long term customer. And, my mail carrier has another check to deliver.

I see so many people who would rather settle for instant gratification, rather than long term security. You can spend your time, money and energy doing one deal, and get one check, or you can spend the same amount of time, money and energy doing one deal, and get checks for years. So once you have a customer with a good proven track record, hold on to them as long as possible. It might be hard to find a good replacement.

Hope this helps,


(Un)Common Sense - Posted by Eric C

Posted by Eric C on May 10, 2000 at 11:19:49:

Hi -

Lonnie just gave you an entire business course in one post. Make the most of it.

The only things rarer these days than people with clean credit are those who combine careful judgement and common sense with a long term view of their business. Rare indeed.

Great post (as always)!


Eric C

Re: mobile home values - Posted by Don Brotherton

Posted by Don Brotherton on May 05, 2000 at 19:04:48:


I’m new to this column, but you seem to think like me!
You seem like an old “BUY HERE PAY HERE” car dealer. My question about loaning the money is, how do you loan the money and not get labled as a finance company and have to comply with all the “laws and licensing”.