Posted by Lisa in Oz on January 19, 2000 at 18:57:32:
By the way, the park is located in a little town called Olivehurst (40 minutes N. of Sacramento)–very low income, hence, low lot rents.
Roll on Atlanta!
Would you do a Lonnie deal if you couldn’t “kick the tires”? - Posted by Lisa in Oz
Posted by Lisa in Oz on January 19, 2000 at 17:16:15:
Through the magic of the web, I’ve found a MH near my mother’s place in California. Now, it’s bad enough I’ve never done a Lonnie deal, but I can’t even have a look at it until after the convention.
The agent says: It’s a 2bd/1ba single wide with internal laundry (no w/d) and a refrigerator. It’s in good shape (of course it is!) just needs a clean and paint. No garbage to be removed.
Asking price is $4500. Lot rent is $274. Owner will finance with large down. (What’s a LARGE down when the price is only $4500?).
Looking at the classsifieds for the local paper, there are other (more expensive) mobile homes being offered with owner financing, so this will be nothing new to the area. Except that I was thinking, if I bought it, to offer it with no money down just to create interest.
Advice?
Re: Would you do a Lonnie deal if you couldn’t “kick the tires”? - Posted by Glenn OH
Posted by Glenn OH on January 19, 2000 at 17:56:26:
The key to Lonnie deals is buy wholesale, sell retail with financing. With agent involved you’re being quoted retail. With financing available, they are already trying the selling method. Without knowing that market, how can you know what it is worth?
Just food for thought.
Re: Would you do a Lonnie deal if you couldn’t - Posted by Lisa in Oz
Posted by Lisa in Oz on January 19, 2000 at 18:18:23:
I guess it would be a risk, but for the dollars we’re talking here, it seemed like a good idea at the time. I don’t know the MH market, but I do know what rents go for in the area.
It’s just frustrating sitting here in the heat on the other side of the planet when you guys are getting all the deals!
Thanks for the response.
Lonnnie Deals from afar - Posted by Dirk Roach
Posted by Dirk Roach on January 19, 2000 at 18:43:15:
Hi Lisa,
I have bought a couple of MH’s here in S. CA, I’m not sure of the area that your talking about, but the LOW space rent made my eyebrows raise when reading your original post. Of course CA is a big state etc, so of course markets WILL vary.
Now as I said I have bought a few MH’s. I have bought from dealers, Private Owners, other Lonnie people, Parks, Auctions, even a gas station once (the Business owned the MH), but I have never bought from an Agent. That being said though, if the price is right…AND if the deal fits my parameters of what I want, then why not.
But I am here and on top of it. I know everyone I need to know, (city speaking etc.) I know the parks, and I know the market. So chances are I am going to win, on the deal. However that is not an absolute! There is risk, there always is. That unforeseen variable can sneak up and say hello.
Being what 7 time zones away from the deal could be a hindrance.
I have a pretty oiled machine in regards to Lonnie deals, but even so I on average show a home 7 times before it is sold and the deal complete.
I also have an incredibly low default percentage. However I’m ready for when and if that should occur. Myself I would pass on the deal.
Who is going to service this Note? Who is going to create it?
As for offering it NO DOWN, I don’t like that plan. I know several people who have played that particular game and all have heavy default rates. It’s logical though, because of the clientele you attract. I myself am a big fan of 10% down (at a min.) Basically if folks are putting down a big chunk of change (for them) then they are going to be of a more “Home-owner” mentality and make their payments. If they have nothing in it, what does it matter?
These are all things to think about.
that is my opinion, hope it helps,
Dirk
P.S. Hope I didn’t sound like a wet blanket, and I look forward to seeing you at the convention.