Just closed on a MHP and looking for advice from those with experience in taking over a park. I've read in the forum some suggestions for the folks who currently pay cash, but my next question is how many of you have tenants sign leases? Ours our currently month-to-month with little turnover. Also, do you have them sign any agreement about park rules, expectations, etc.? Curious what information you collect for current or new tenants?
You can have them sign new m2m rental agreements. But for sure you want to post on every tenants’ front door your Intro letter (there’s a new owner), new Rules and Regs, instructions on how to pay rent every month (if that is changing), and anything else you want them to know. Make sure you set up all the bills to your company name and your PO Box also.
Tenants can not know something you do not tell them. If it is to their advantage they will play dumb, usually lie, even when they do know.
You must send all tenants a copy of the community rules and everything that is expected of them as if they have never lived in the community before the day you take ownership.
Likely hood is that as the new owner you will have to retrain the majority of tenants to your expectations. You must be rigid in enforcing the community rules so never include any rule you do not intend to enforce. You must, absolutely must, fully know and understand the state landlord tennat regulations. You should never be dealing with tenants unless you know the regulations.
The quality of a community depends on the rules and insuring they are rigidly enforced.
The community rules should be part of your lease and by insuring each tenant receives a copy in most jurisdictions it becomes enforceable. They do not need to sign it.
We are taking over ownership of our 1st park in 2 weeks. We are having the seller give each tenant a transition letter introducing them to our company and spelling out the following:
1. All tenants in good standing are welcome to remain but are required to sign a new 12 month lease. This is leveraged investment for us so we want the stabilized income to document to the bank.
2. How and where they are now to pay rent. That there will be no more on site collecting of the rent by us or our park maintenance man.
3. We are implementing an increase in rent rates and are providing 90 days advanced notice on this transition letter.
4. We are giving them notice that we have park improvements planned. We are not committing to specifics or dates, but we are trying to provide some value add for the upcoming rent rate increase.
This park has been owned by the same family for 25 years. Rent rates are well below market and we don't expect much loss of tenants. There really is nowhere else for them to go at the price point we are raising to.
In addition to Rules & Regs and a lease, I would add a tenant information form. A lease only lists a tenant's name. You'll need info like phone #'s, SS# (ideally), etc.