Where to get financing ?

Question

For qualified buyers - what are some of the best ways to finance a purchase of a mobile home park?

Included in the financing would be land - water sources - mobile homes - sheds - decks  & a cash cow of rental income with very low expense ratio to income - a  small all adult mobile home with never a vacancy, & most of the rental income comes from Uncle Sam.

Also when selling something such as this - what is the best way to weed out the tire kickers? Get some sort of deposit in hand before financial s are released? Would like some advice from others who have sold a park recently.

Sonny

Mike Matthews · Answer

Call my friend Hilda Everett, She finances MH  in parks all over the US. She will be speaking at my Mobile Home Focus Group this month. It is free to all RICH members.

Hilda Everett.  (281) 292-8200

http://www.mobilehomefinanceonline.com

Marc Faulkner · Answer

I would try:
Monroe and Giordano, LLC (813) 229-5055
monroe-giordano.com

Security Mortgage: (585)423-0230
securitymortgagegroup.net

Tell them that Marc sent you!  They can give you the guidelines to finance a manufactured home cummunity.  Good luck:)

Rachel H. · Answer

Thanks for the kudos, Charles. Appreciate it!

I've gotten the same question from other people. I've heard of other investors out there who have tried doing the lease option/sub-to thing with mobile homes. Honestly, I don't really know if they are cash flowing. It's hard to do that especially when people are overleveraged on the notes with the new manufactured homes - most times the interest rates are higher than most (double digits) . So, it would be hard to do lease option/sub to unless you know for sure you can bring in a buyer and make the #s work on the monthly pmt and you're cash flowing - just what I've seen.

In my experience, most people who either don't have a mortgage on their mobile home or a small amount left, just want to sell straight cash and move on. Most of them don't really want to finance.

I've never done a lease option/sub-to before with the mobiles, I just buy straight cash. Though if you know your market and know you can make the #s work with an opportunity you find, it just might.

Hope that helps!

Charles B. · Answer

First, thanks for your contributions to this thread Rachel. Its been helpful even for those of us who are far from new to investing to hear the mobile home side of things.

I am curious. With so few institutional financing options, have you seen Lease Options, Subject to, or seller finance deals work in mobile home investing?

Rachel H. · Answer

Hi Noe,
                                    Right now, I do not know of any lenders who will lend on used manufactured homes themselves as personal property (not with the land/mobile home park). I've heard that Clayton Homes may be considering this down the road. I know that Vanderbuilt Mortgage and 21st Century Mortgage still lend on manufactured homes but they have to be brand new from the dealership, not the used ones. Buying new from the dealership, you're looking at least 35k+ on a brand new singlewide, double that on a doublewide. I deal only with used mobile homes (not the new ones), and buying used involves cash and/or private $, it is very hard to get financing on the used mobile homes. 
                                    
                                    If you have a local bank you work with, they may be willing to work with you depending on your relationship with them though I am sure they will need some kind of collateral. Private money and/or cash is by far the best way to go in the mobile home business. Hope that helps!

NOE R. · Answer

Rachel, or somebody who knows, what lenders are doing loans for clients who want to purchase Manufactured Home in Parks. I'm in Southern California and it's hard to get this type of Loans.
Hope someone can help me.

Rachel H. · Answer

There are a few but most of them want very near to 90-100% occupancy, newer homes and most want them in the most desirable areas - most times, they are very picky. I've heard that some lenders say they can do 90% financing but it seems a little fishy to me - the terms may be pretty ridiculous. If it's a turn around park and less than 50% occupied, most times private money is the only way to go. Hope that helps!

Charles B. · Answer

I love the idea of private funding for any deal. I make my living hunting around for private funds for deals. However, out of curiousity, aren't there ANY national or regional lenders for mobile home parks? And if so, what are typcially the lender guidelines?

I would imagine you are talking about a high interest rate and lower LTVs, but I could be wrong. I appreciate input from anyone with more mobile home park financing experience than I have.

Rachel H. · Answer

Private money and/or seller financing. Hope that helps!

Mike Matthews · Answer

Private Money, I would go to an 1031 Exchange. Do you want to use a friend I use for this?