Real Estate Agent · Las Vegas, NV · Member since 2016 · 9 posts · 1 vote
I currently own 5 mobile home's in 3 different parks in Las Vegas. So they're considered personal property (not attached to land). I acquired these all with cash. When I sold them (I'm carrying the financing on all of them), I used a MLO, who also is a Manufactured Home dealer to work up the note and transact the sale. So I collected a downpayment on all of them, and I'm receiving between $300-500/mo in payments. I'm the lienholder on the title. My question, in short, is how do I get someone out when they stop making payment's? As I study the terms of the contract that I've put these buyer's in, I should be able to convert them to tenants-at-will, then evict them.
Do anyone with experience know how to do this?
I had one person just leave, and give me the key's back (which was pretty nice). I've got another buyer who is a couple month's late on payment to me and the park...they've gotta go. So if I have to go thru the proper channels to do this, how would I go about doing this?
@Steve Morris I'm going through the EXACT same thing as I type this from Pennsylvania. My first tenant buyer problem in 8 years. They got hooked on drugs, but worse still they are using every legal angle of the law against me, and they are the scumbags not paying. They even tried to sue ME in small claims court for $12k claiming all sorts of bogus BS. This has been going on for over a year now. I will tell what I did right and what I did wrong. What I did right, I did not accept any partial payments, I didnt go on the premises or try to shut off utilities etc, or harass them in anyway.
What I did wrong. I initially tried to counter sue in small claims to get possession of my mobile home back since they were suing me anyways. Wrong I had to withdraw my complaint and try it in civil court, but good news was the Judge saw all my paperwork and my notes and saw their demeanor vs mine. He ruled in favor of me not paying. So in civil court, I won a judgement on what was owed in back payment which was 4800. But they still owe me $11,000 on note payment. Since they didn't pay on the judgement, I had to go back to the courthouse to get A writ of execution. I'm awaiting a call from the sheriffs office and I'm going to have him tag their car for possession. Since they are still not paying on the note, I have another attorney working on fully getting possesion of the trailer with some law in PA that I cant even tell you.
What the Judge told me, was because my paperwork wasn't specifically spelled out as a lease to purchase, only a promissory note and an agreement of sale, it did not fall under tenant/landlord law. If I had that verbiage in my note and on my contracts, he would have ruled in my favor and ordered them to vacate the premises, but since it wasn't in there all he could grant me was money judgement. Lesson learned the hard way, and its still an on-gong saga, but I see light at the end of the tunnel.
@Steve Morris I'm going through the EXACT same thing as I type this from Pennsylvania. My first tenant buyer problem in 8 years. They got hooked on drugs, but worse still they are using every legal angle of the law against me, and they are the scumbags not paying. They even tried to sue ME in small claims court for $12k claiming all sorts of bogus BS. This has been going on for over a year now. I will tell what I did right and what I did wrong. What I did right, I did not accept any partial payments, I didnt go on the premises or try to shut off utilities etc, or harass them in anyway.
What I did wrong. I initially tried to counter sue in small claims to get possession of my mobile home back since they were suing me anyways. Wrong I had to withdraw my complaint and try it in civil court, but good news was the Judge saw all my paperwork and my notes and saw their demeanor vs mine. He ruled in favor of me not paying. So in civil court, I won a judgement on what was owed in back payment which was 4800. But they still owe me $11,000 on note payment. Since they didn't pay on the judgement, I had to go back to the courthouse to get A writ of execution. I'm awaiting a call from the sheriffs office and I'm going to have him tag their car for possession. Since they are still not paying on the note, I have another attorney working on fully getting possesion of the trailer with some law in PA that I cant even tell you.
What the Judge told me, was because my paperwork wasn't specifically spelled out as a lease to purchase, only a promissory note and an agreement of sale, it did not fall under tenant/landlord law. If I had that verbiage in my note and on my contracts, he would have ruled in my favor and ordered them to vacate the premises, but since it wasn't in there all he could grant me was money judgement. Lesson learned the hard way, and its still an on-gong saga, but I see light at the end of the tunnel.
and just to add for those wondering why I didn't write it up as a lease purchase. Truth be told I didn't think of the transaction being that way. I didn't consider myself a landlord and my paperwork specifically states, seller is not a land lord. I viewed it as the sale was finalized , with affordable payment terms. Just like selling a car on terms. But again, since this happened to me, although it sucks, I learned alot, and have since changed my wording on my contracts.
@Janene Tompkins I now rewrote contracts and promissory notes to say that it's a Lease Purchase Agreement. The fact that it now states its a lease, It falls under tenant/landlord law.
If this were to happen again (hopefully not) I can now evict them, and retake possession of my property, if they don't perform to the agreed terms. (ie make the scheduled payments)
@Steve Morris I wish you luck my man. Hopefully your deadbeats are not as smart as mine using free legal aid to string this out. Best advice I can give is show them no mercy, none. (One of my other mistakes, I can be too nice at times)
Get em out and get em out quick. wishing you best of luck.
I thought that MH's were treated as personal property like a vehicle and not like a house. The idea being that you can just take it back with the sheriff if they don't pay and not have to go through courts. Just like how your car can be repossessed the same with a MH.
@Jonathan Jewell I attended a local seminar some years back regarding the Trials and Tribulations of rental properties, seller finance, etc. The single best take away from that seminar was when the Investor stated that his Attorney starts the eviction notice on the first late payment due. Yes the FIRST LATE. His philosophy was why suffer the extended pain of collection and once word got out to the other renters he seldom had collection problems.
I do not currently have any properties in the rental stage, but if I did I would have my Attorney serve you an eviction notice on your first late. I know that sounds hard, but gee I work hard for my money.
As always check your local and state laws. It's also a great plus if you have a Real Estate Attorney on your team!
@Ronald Bourgeois I 100% agree with you and what you describe (first late send notice) Its a policy I have now have adopted since this happened to me, not matter what the circumstances are. Truth be told, out of 50+ lease purchase deals I have only 2 other lates, for the most part the people I sell to pay me on time every single month. On this particular case I screwed up by being way too nice since there were 2 children involved a 1 year old and a 7 year old. As much as I try to be the terminator, I do give people the benefit of the doubt and try to work with them especially when kids are involved. Little did I know they used those very same kids to manipulate me in a way. But when push came to shove, and they weren't cooperating I had to go after them. If I did it sooner, yeah They would have been out. But here is the bright side. I now have a story to tell!!! I can share my mistake with the rest of the BP folks, so others can learn from it. :-) and I learned a few things too.
It's easier to repossess than foreclose, so do your best to keep it as personal property. Read up on Warren Buffet and Clayton Homes et. al., they have a pretty good system of lending at high rates and repossessing them.
@Jon Weldon. It depends on the state your in. Here is PA mh's are treated as real estate and taxed as such.
BTW Buffet is a total scum bag for what he's doing to people that buy Claytons homes. Completely and legally exploiting and stealing from people. He used to be someone I admired back in the day but no more.
Jonathan Jewell good info! I wanted to ask you your opinion on a few things:
I'm currently under contract on a MHP, and there are a few park-owned homes that I would like to sell via seller finance if I end up buying the MHP. When I carry the mortgage and we both sign all the docs the title gets transferred to the resident (aka new home owner), they pay me a down payment, and they start making monthly payments to me.
-But my question is since they are now the owner of the home (they hold title to it), if they stop paying the mortgage and/or the lot rent what do I do? Can't I foreclose on the home or repossess it?
-Can I still evict them?
-Can I still take back the home even if they now hold title on it?
I know I will definitely talk to a RE attorney but I just want your thoughts on this since you've had some experience in this space.
Thank you!
Congrats @Gulliver R.!!! Well I do things a little differently to protect myself from what you described (non payment) I keep the titles in my companies name on my premises. Once the note is paid off, then they received the signed title for them to put in there own names. Other individuals and banks mostly will issue the title in the borrowers name BUT they put a lien on the title. The borrower still does not get possession of the title until after the note has been paid off, which then the lien is signed off on and mailed to the borrower. Look at the two titles. One just came back the other was from a trailer I just purchased. You see what I mean
I like the most protection, and not thrilled with the idea of yet another cook in the pot. I also don't like the idea of the buyer holding onto the title. I cannot tell you how many people have lost thier own title..... omg so far I would say I'm a little over 110 meeting sellers with no title.
Thats the way I do it. Like I said in previous posts, where I screwed up was in my wording in my agreements or rather lack thereof. Put LEASE TO OWN in bold. Make it clear. Lesson learned for me. One papers are signed and payments are no longer being made you can evict as if they were a renter. No need to foreclose, because your not recording a mortgage with the county
Jonathan Jewell so then basically you're actually doing a Lease-Option contract (aka Rent-to-Own) with the buyer (not a Seller Finance deal)? Because selling the home to the buyer as a seller finance contract usually will transfer the title from the seller to the buyer from day 1. But with a Lease Option the title is still by you (the Seller) until the buyer pays off the balance and is paid in full.
Jonathan Jewell so before they pay the balance in full, whenever there is a leaky roof or a busted water heater you have to get that stuff fixed/repaired since you still hold title to that home, right? That's the thing that I want to avoid (me as the Seller).
Mobile Home is being sold AS-IS with no warranty expressed or implied. Buyer is responsible for all repairs after signing,
Just think of it as a smaller house. They don't go to the lender or previous seller to get home fixed down the line correct?
Also you mentioned the roof and water heater. In my business I completely renovate the homes they have pretty much new everything. I also coat the roofs and install new water heaters if they are over 5 years old. I don't like headaches or having to comeback OR having a reputation that I sell sheet, which I don't. People love my homes. So I go the extra mile and make sure everything is new or fixed properly before anyone moves in.
Check with your local government on how to deal with this issue. If they're tenants and do not have the title in their name, you'll have to go through the proper eviction proceedings. Though, if you actually gave them title and they have an equity interest you'll have to go through the foreclosure process.
One thing that's worked for me is to put everything in writing. I do things just like the park and act like a company and professional business. Everyone has their own way of doing things but this method has just worked for me.
Correct me if I'm wrong but shouldn't everyone here have a 'Real Estate Lawyer' on their team? You can pay your Lawyer a few hundred dollars now or go thru the 'Pain and Suffering' later. I mean to me this only makes common sense. Make sure your Atty is a 'Real Estate Lawyer' [not an ambulance chaser]. Your lawyer should work primarily in Real Estate matters. Your local REIA group should have a list of proficient Lawyers for you to interview.
If your not affiliated with a local REIA use the link below to find a local Real Estate Investment group. A good REIA group is priceless to your early and continued success.
@Janene Tompkins I now rewrote contracts and promissory notes to say that it's a Lease Purchase Agreement. The fact that it now states its a lease, It falls under tenant/landlord law.
If this were to happen again (hopefully not) I can now evict them, and retake possession of my property, if they don't perform to the agreed terms. (ie make the scheduled payments)
It says lease purchase or lease with option to purchase?