21.2% annual cash on cash return and can't find financing

21.2% annual cash on cash return and can't find financing

Investor · Provo, UT · Member since 2016 · 759 posts · 626 votes

About a year ago I finished an expansion of a mobile home park I own. The city required us to bring in all new homes in the new spaces.

I have had a very difficult time figuring out financing for the empty spaces. I have filled a few of them by using investors then selling the homes and giving them a significant margin, it is located in a great area.

21st Mortgage approved us for their consumer financing but said that they would not do a dealer line for new homes until we did two or three of those. They also cap the sale price so their program doesn't work for my investors.

I am looking for a private money connection that is willing to finance new homes from the factory for sale or for rent. The most recent sale was a $35,000 profit which came out to almost 40% for the investor. There is a lot of opportunity but since it is not real property it has been a struggle.

We are willing to do a second lien position on the park itself to make a lender comfortable.

Here is the park I am talking about:

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Contractor · Scottsdale, AZ · Member since 2010 · 2k+ posts · 3k+ votes
3y

Logan, some friendly feedback here...

I have read your post 3 times and I still have no idea what you are asking for or what you need help with.

Based on the title of your thread you are looking to find financing. I recommend you clean up how you present what you are looking for. You need to present a clear and concise value proposition for lenders or investors.

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  • Contractor · Scottsdale, AZ · Member since 2010 · 2k+ posts · 3k+ votes
    3y

    Logan, some friendly feedback here...

    I have read your post 3 times and I still have no idea what you are asking for or what you need help with.

    Based on the title of your thread you are looking to find financing. I recommend you clean up how you present what you are looking for. You need to present a clear and concise value proposition for lenders or investors.

  • Henry ClarkPro Member
    Developer · Member since 2020 · 4k+ posts · 4k+ votes
    3y

    If I’m reading correctly.  Recommend you don’t buy the homes. Even if you’re making money on their sale.

    The money and reduced risk is in the lot rentals.  Talk with the closest seller.  Offer them free rent to set up and sell new homes at your park.   Also tell them you will give first year rent feeto any of their buyers. You can sit on empty lots or get them to working. Mobile homes are sticky. They won’t move later. 

  • Jordan MoorheadBusiness Member
    Real Estate Agent · Austin, TX · Member since 2015 · 5k+ posts · 3k+ votes
    3y

    @Logan M. I may know a guy

  • Investor · Las Vegas, NV · Member since 2013 · 8k+ posts · 10k+ votes
    3y

    Why won’t the first investor invest again after making 40%?

    I assume you don’t own a car or have any equity in your home, or a 401k at work, or a couple credit cards with higher limits? But you’re also saying the park isn’t making enough to buy $35k mobile homes? I assume the sellers to you would offer financing if you asked. 

    If you’re making 40% you only have to swing one or maybe 2 sales before you can pay cash for the rest. Figure out what you would do if you have a $35k repair tomorrow that has to be done or the work will be closed and your income will stop, and do that. 

  • Investor · Provo, UT · Member since 2016 · 759 posts · 626 votes
    3y
    Quote from @Bill B.:

    Why won’t the first investor invest again after making 40%?

    I assume you don’t own a car or have any equity in your home, or a 401k at work, or a couple credit cards with higher limits? But you’re also saying the park isn’t making enough to buy $35k mobile homes? I assume the sellers to you would offer financing if you asked. 

    If you’re making 40% you only have to swing one or maybe 2 sales before you can pay cash for the rest. Figure out what you would do if you have a $35k repair tomorrow that has to be done or the work will be closed and your income will stop, and do that. 


     The investors that have invested did invest again but I am looking for financing so I don't have to pay out all the upside and I can fill my community faster. We have almost 20 spaces to fill with a huge list of renters and potential buyers.

  • Investor · Provo, UT · Member since 2016 · 759 posts · 626 votes
    3y
    Quote from @Jordan Moorhead:

    @Logan M. I may know a guy


     DM me the info if you can

  • Member since 2023 · 21 posts · 7 votes
    2y

    Just get the homes with Legacy and finance with them, they can do it in house for all factory direct sales.

  • Investor · Provo, UT · Member since 2016 · 759 posts · 626 votes
    2y
    Quote from @Myles Mannino:

    Just get the homes with Legacy and finance with them, they can do it in house for all factory direct sales.


     Where were you two months ago!? I am signing an order with them today.

  • Member since 2023 · 21 posts · 7 votes
    2y
    Quote from @Logan M.:
    Quote from @Myles Mannino:

    Just get the homes with Legacy and finance with them, they can do it in house for all factory direct sales.


     Where were you two months ago!? I am signing an order with them today.


     That's great! Sorry I am new to the industry.

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