How do MHP appraisals work?

6 Replies

Hey BP gang, how do you deal with a MHP appraisal? I just got a quote from the bank on two different appraisers for $2200 and $4400. Since the parks evaluate on an income basis, how is an appraiser going to figure out value if he doesn't have any financials that I'm aware of. I suppose he could request them, but I doubt they'll do the kind of work I'll do on the project to figure out value. Just wondering as that's a decent sized check to write for an appraisal. 

@Matt Kauffman , it is highly dependent on the appraiser as to the quality of your appraisal. Ideally they will use someone who specializes in or at least has experience valuing MHPs. I am not sure why the appraiser would not have access to the financials if the bank is considering loaning on it. I don't know of any bank that would do a commercial loan without knowing how much income the collateral is generating.

If you can, I would call the two different appraisers and determine what their level of experience is with MHPs. Go with the one that has real experience because if they don't, God only knows what kind of a value they will come in at, but it could be ridiculously high or low.

Hey, I wish I had more to tell you, but I don't. I walked away from this deal due to water issues. There was one well for 35 sites, 2-3 locations only to drill new wells, and a significant amount of money needed spent on putting up a building to house storage tanks so that the park would have water and pressure. compounding the problem was the well drilling company telling me that they'd drilled 2-3 wells years ago that came up empty. Too much risk for me to take on.