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,
Lonnie