OK to take title to Mobile Home subject to loan? - Posted by Debby in Houston

Posted by Robert (AL) on May 08, 1999 at 23:52:04:

Great post Dirk, I like your colorful description! (lol)


OK to take title to Mobile Home subject to loan? - Posted by Debby in Houston

Posted by Debby in Houston on May 08, 1999 at 10:52:14:

Found a 1994 Fleetwood 16x70 2-2 w/loan bal $26,800. Couple ready to walk if don’t sell soon. I’ve never done mobile homes yet. Pymt is 237.22 on loan and 135 on lot in a mediocre park. Can I take take title without assuming loan? Will they (The Associates) find out? Can I take title in a land trust? So much to learn! Help! Thank you all!

Re: OK to take title to Mobile Home subject to loan? - Posted by Alex Gurevich, TX

Posted by Alex Gurevich, TX on May 10, 1999 at 16:58:23:

Consider making a jump to www.tdhca.state.tx.us/mh.htm, the site containing a set of MHousing laws for Texas, before you do anything. Texas laws are extremely strict for buying and selling MHs, unless 1) you have a license and 2) do it Lonnie’s way, i.e. buying for cash and selling with the owner financed lien.

From my reading of the law, lease/options and “subject tos” are prohibited, since by law one must deliver free and clear title (except purchase money lien).

The only area not defined by law in any way is renting, and possibly renting with option. So, perhaps renting with option from seller and same to buyer will work. Here, in Austin, in seems that you have to go to outskirts of town into lower grade MH parks to get permission from park managers to have a rental MH. Since moving a MH is costs prohibitive, taking over payments in a good park is pretty much not an option.

So, do your home work and figure out your exit (perhaps, also exit out of of the park) strategy

Re: OK to take title to Mobile Home subject to loan? - Posted by David Alexander

Posted by David Alexander on May 08, 1999 at 19:20:13:

Check the Archives, for Dan fink. He has a complete rundown on how to do this kind of deal. This particular deal you might be able to squeeze 75-125 a month out of with $1500 cash up front. Most of the subject to Mh deals that I have chased have been a waste of time. As far as the trust thing it is a little harder to accomplish with a subject to Mh from what I understand. You’ll get a power of Attorney and a L/O agreement, Loan authorization, and just start making payments. Chances are Associates won’t care as long as the payments are current.

Good Luck

David Alexander

Ant or Grasshopper - Posted by Dirk Roach

Posted by Dirk Roach on May 08, 1999 at 13:15:36:

Hi Debby,
Let me say welcome to the wonderful, thrilling and exciting worlds of mh’s. I say this because you are considering MH’s as an investment vehicle. Wait till you start to discover the ins and outs of it and start looking at those yields. :slight_smile:
Ok first you need to pick up Lonnie Scruggs Martial. His books are a must. In fact I would recommend buying any MH without reading his books.
Once you’ve done that, you have to wipe those big numbers out of your head.
The key to Owner financed MH’s (Lonnie deals) are having a bunch of “Little Deals” working. Think of them as a ant farm, chugging along and working out, pumping out money, while the grasshoppers sit and do nothing.
What you have found is a grasshopper. I’m not trying to discourage you, but pursuing this deal may not be the best route.
They’re are ways to do it, (i.e. going through a trust etc.) however, you are setting yourself up in a risk situation. If you are just in love with this deal, and want that MH more than anything, and I or anyone else can’t talk you out of it, then I would wait till the people walk. Associates will take it back. Now remember the last thing that Associates wants is this Mobile Home. It will go on their list and get faxed out to dealers and other interested people. They will then except all these bids from folks and the highest gets it. If Associates are lucky it will probably come in somewhere in the neighborhood of 15k or so. However most likely it will go to a dealer, who will then find someone who has A credit and get them financed (back through Associates). And it’s a big Circle and a couple of years down the road it’ll all happen again.
The big tip off here it is too new.
Check out the success stories and how-to articles on this site.
I know it seems that you want to get in there on these new MH’s but really your jumping into a crowded pond. Now lets say next door to this new home there sits a 1978, 12x60, with a ripped screen, torn Astroturf, and real dusty paint job. There is a For Sale By Owner Sign in the window. Now this is something that you should inquire about! So you go and knock on the door and this guy answer the door and lets you see the home. The carpet is a little threadbare. It is a little messy. And after you look around at the home and think to yourself “Man is this place a dump”, you start talking to this guy. In a round about way you begin to pump this guy for information. In doing that you find out that he needs to sell bad, he has been trying to sell for a month now and now next week he has to be 100 miles away on a new job. He’s not happy because everyone has been looking at the nice, newer, Mh next door. Oh and he wants 4 thousand dollars for his “free and clear” mobile home.
So you explain to him that you of course will have to make sure that the mh can remain where it is, and get park qualified, which shouldn’t be a problem because you have good credit (say this even if you don’t). Oh and since your going to want to fix all the damage and repaint and put in new carpet and read off the laundry list that you’ve collected in your head while looking at the home. Now ask him taking all that into account "What is the best price that you can do, if I can pay you CASH in like 24 hours?"
He thinks a sec, and comes back with “Well look can you give me 2 thousand?” Then you think a sec. And say okay and then go to your car get out your photocopied Agreement to buy contract that you’ve gotten out of Lonnie’s book.
Fill it out right then and there and get him to sign. Give him $10 dollars to make it legal. He’ll get the rest when he’s ready to move out and hands you over the keys and you are satisfied with the condition, and you’ve checked everything out with the park and DMV (whomever handles registration for your state etc.) Oh and of course you’ve made sure that he has a title for the home (do that before you get the contract).
Now providing everything is cool, you have just picked up a MH which you can sell on payments to a nice young couple who are just starting out. You can sell this with little or no fix up work (sell as is and have them fix it up). You can sell it to them for whatever probably 8 or 9k with a thousand down. So you’ve got a thousand bucks into the home and monthly payments of like $250 dollars a month rolling in for the length of your note.
All while some dealer is trying to find someone with A credit and a couple of thousand to put down on a MH next door to your older, less pretty one. Of course All the realtors in town are also trying to get the same A credit person to buy their homes. Which is great because since the person has A credit and can get a super interest rate right now, all the lenders are happy too. Now while all of this is happening, your little $250 dollar checks are rolling in. And your out doing more deals, because you see this big market, where there is no compition. Oh yeah you also have some motivation, because you see that if you get enough of those $250 dollar checks coming in, it won’t be long before you can quit your job, hang out a lot here on the site, and do whatever, all because your money is working for you. Your Ant is working out while the grasshopper next door is sitting vacant.
Hope this helps, and let us know what you.