MH rehab free & clear on one acre. Pull equity for next project?

Question

Hi all.  i live in and have completed a full rehab on a MH in TX. I own the land and MH free and clear. Wondering if it is possible to tap equity for my next project. Other MH properties in the same subdivision  selling at 125K+.  What do you think and has anyone else done this?

Christopher Gilbert · Answer

I have the newest version of "deal on wheels" and it had some Dodd-Frank info in it but most of what I have found has been very general or hear-say from people that have done it but never had it questioned in court.

If you only plan on doing one owner finance sale then it is not too big of a deal, just make sure you do your credit checks and find a good title company to make sure the lien is done properly against the structure AND the land.

With the Dodd-Frank act it made owner financing a little trickier.  The second and third properties that you sell have to be fixed rate, etc. and have some more restrictions.  The forth property (in a 12 month period) has to be done by a certified loan originator, which you can probably pay a loan mortgage broker to do for you but will cost some money.

I do not rule out owner finance sales but I always end up making my flips FHA loan qualified and let the buyer get their own financing.  Less headaches in the long run and I get my money back faster.

Michael Bigler · Answer

Thanks Chris.  i thoight as much.  Most likely going to sell owner finance and work on a couple of LOCs to get the next deal going.  Ive already had interest in this property so shouldnt be too difficult to unload.  Any recommended reads for owner finance?

Christopher Gilbert · Answer

@Michael Bigler

If the home is your personal residence, tied down to the foundation and qualifies for an FHA loan you might have a shot.  We have not had any luck getting equity out on any of our manufactured houses but they are all investment properties so they typically follow different requirements.

Let me know if you find a lender that is willing to do equity loans on investment manufactured homes.  We have been flipping them but would be interested in a buy/fix/refi/rent model as well.