Posted by Eric Anderson on February 14, 2000 at 11:23:06:
Gator,
Thanks for the tip. I’ll get right on it. It surely is a compliment. I like your “down-home” approach to the business. It seems to me you’ve got it figured out
I follow your postings right along with Dirk and Tony from VA
Keep up the good work and the laid-back attitude.
Eric
Newbies idea for creative MH financing - Posted by Brad (TX)
Posted by Brad (TX) on February 11, 2000 at 08:59:46:
This is probably not really “new” or “creative” and may be a bad idea. I just don’t know, so here goes:
Keep in mind, this is Houston. Decent MH’s are more expensive here.
I’m coming accross typical deals for 3/2’s about 10 years old that someone is trying to sell for $19k. Well, they can’t find the cash buyers, and end up calling me. If I can buy the home for, say, $10,000, and I don’t want to finance it over 6-8 years with borrowed money, why couldn’t I structure a deal like this:
-I buy the home for $10k that has a NADA value of $17k.
-I sell the home for $19k, $500 down, with owner financing, making sure my buyer has decent credit. This enables my buyer to get into a more expensive home with very litte down.
-A couple of weeks after the deal is closed, I tell the buyer I will knock $1,000 of the balance due, if they will refincance with Conseco. On top of that I will pay all closing costs so they have no out of pocket expenses. I show them how much money they will save going this route, and that I am willing to do it because I need the cash.
In the end, I walk away with a check for $17k from Conseco, and a $5k-$6k profit, and a total of $15k for another deal.
Is this a conceivable way to get cash out of the more expensive deals where owner financing would otherwise require a 6-10 year term?
Please shoot this idea down as quickly as possible. I’m tired of thinking about it!
it can work - Posted by Gator
Posted by Gator on February 11, 2000 at 14:32:12:
Brad,
My application is a Canseco/Greentree application. I first try to cash them out with Greentree. If they don’t want it, I may finance them. I could never get them to apply if I had already financed it for them. Never figured out exactly why. I fax the app to good old Steve at Greentree and call him to tell him its comin and he usually can have them approved by the next day. Everybody’s happy. Buyer, Financer, Gator all happy. So I already use your idea, I’ve just got probably a little more streamlined than you have yet.
Now about your other statement. “Keep in mind, this is Houston. Decent MH’s are more expensive here.” I’m sorry but I’ve just heard it so many times and then later seen someone post about how they have been doing lonnie deals in that same area. I don’t know Houston as well as you do but just make sure that you aren’t overlooking them. The only thing I know about trailers in Houston is that Bud and Sissy lived in one in the movie Urban Cowboy. You know if it was me I’d have stuck with that dark haired rich girl that Bud picked up in the bar. She was a lot sharper than Debra Winger and of course the fact that she had lots of money wouldn’t make me love her no less,… sorry I got off the subject. Personally I’ve never bought anything in the $8k and up price range but maybe it’ll work for you. Just be careful out there and drink a Lone Star for me. Best Wishes,
Gator
Re: Newbies idea for creative MH financing - Posted by David Alexander
Posted by David Alexander on February 11, 2000 at 13:24:38:
You can do that all day long, question is do you want to? Ok, a run down of what I mean.
You sell the home for 19k with $500 down. Leaves a balance of 18,500 that you finance. It will look something like this.
13% I, 96 N, 18,500 PV, PMT 310.93
First you need to know the payment the area and MH can support.
Next you have to pay your mom back. Dont know what’s reasonable to pay her.
Maybe something like this.
9500 PV, 8% I, 96 N, pmt $134.30
You now have a spread of 176.63 a month.
Problem arises when starting out no more cash to do more deals. Now you need the guy to refinance. But, he doesnt have to.
Instead maybe get an option to buy the home, for 30-60 days, find a buyer and get them financing. Or buy the home with 4k now and 6k in the future.
The name of the game is Cash to Asset to Cash until you can afford to let the money and and cash flow ride.
Or how about this, you could feasably do three Lonnie deals with the 10k, possibly 4 if you were patient.
That would create about 30k or so in paper, that you could sell or borrow againstor get the payor to refi, to do more.
David Alexander
Re: Newbies idea for creative MH financing - Posted by SteveA (FL)
Posted by SteveA (FL) on February 11, 2000 at 10:04:04:
How do you walk away with $15K for another deal? You still owe your mom $10K.
Re: Newbies idea for creative MH financing - Posted by Bill K. - FL
Posted by Bill K. - FL on February 11, 2000 at 09:22:38:
Brad,
Three questions. 1. Where is the 10K coming from?
2. Will Conseco lend 100% LTV?/How much cost is involved to get the loan?
Also $1000 doesn’t seem like much of a motivator.
3. What if your buyer can’t qualify?
Try this.
Buy subject to or L/O with little cash and resell with terms.
Nothin’ like a happy gator ! (NT) - Posted by DougO(NM)
Posted by DougO(NM) on February 12, 2000 at 19:11:13:
nt
Green Gator Trees - Posted by Eric Anderson
Posted by Eric Anderson on February 11, 2000 at 17:27:53:
I Like your approach, wouldn’t mind using it now and then. There are mucho Greentree offices out there Gator. Would you mind posting or emailing a phone number so I can get ahold of ol’ steve.
Muy amable, gracias. Eric
I have a nice Mom! - Posted by Brad (TX)
Posted by Brad (TX) on February 11, 2000 at 10:08:09:
(smile)
Re: Newbies idea for creative MH financing - Posted by Gene S Hou
Posted by Gene S Hou on February 11, 2000 at 11:02:39:
Hi Brad: I agree with Bill K Fla advice 100%! Take a couple courses on “subject to” & L/O. Those MH deals will still be there. Rich club will also have workshops during course of year.
Re: Newbies idea for creative MH financing - Posted by Brad (TX)
Posted by Brad (TX) on February 11, 2000 at 09:56:54:
Answers:
Subject to?..Lease/Option?. I’m just a simple minded MH guy, not a sophistated REI. Your world frightens and confuses me!
I feel another learning curve comin’ on.
Re: Green Gator Trees - Posted by Ed Ortiz
Posted by Ed Ortiz on February 12, 2000 at 20:44:26:
I would also like to get ol’ stevie’s # and address…PLEASE???
Re: Gator-aid - Posted by Eric Anderson
Posted by Eric Anderson on February 12, 2000 at 23:53:41:
Ed, If I get a response from Gator I’ll send it on.
Gator is probably busy right now looking for a scoop shovel so he can count his money.
Eric.
your too kind - Posted by Gator
Posted by Gator on February 14, 2000 at 09:54:55:
Eric,
I take your comment about needing a scoop for all my money as a great compliment. Unfortunately I’m not quite there. I’ve been lucky but I’m still workin my tail off just like you. I have a corn scoop and a coal scoop but don’t really need them. My wife keeps track of the money. Anyway I left my daytimer at home so I don’t have the phone number for greentree with me but I don’t think it would do you any good anyway. I think they have local offices. I use the Madison(Nashville) for Tennessee deals and the Paducah KY office for Kentucky deals. I would suggest looking in the yellow pages for an office in a large city near you or looking up the Canseco website and getting a phone number. Tell them your selling used mobile homes and need to get your buyers financing. They want your business. They work on commission. You will feel the love. If you pick up a copy of a trade magazine like Manufactured Home Retailer,(i forget the names of them) they are loaded with advertisements for Associates, Canseco, and others that do MH financing.
Best wishes,
Gator