Lonnie Deals Info
Hello all… Just trying to get more info before I do my first Lonnie deal. Getting MH park mangers to agree to not charge you lot rent, while you’re getting the MH ready to be sold. Is this a common practice?? Why would the MH park manger agree to this??
Yes, it's common and they do it because it's very hard to fill a vacancy, so when I have a Lonnie dealer who wants to work with my park, I love it. I usually let them put the home in there and market it, without charging them pad rent. I know lots of other owners who do the same, so I've been told by them, and read.
Look around, you'll find someone who will do it. If you need a list of MHP owners in your area, [REMOVED] offers lists for free.
Thanks Karen, for all the great info. Can you PM me that web-site were I can get that free list of MHP owner's in my area. I think I have a good handle on most of the MHP's in this area, but every bit of info helps...
As a MHP owner if you have vacant spaces, you offer incentives to get the spaces filled. I usually offer $1500 reimbursement of moving cots to move a home in, free lot rent during set-up and repairs, manager will show the property and do the screening. When sold to buyer then the lot rent starts. If it is a home already in the MHP - you are not getting rent on it anyway, so providing free lot rents to get it repaired and sold is no skin off of your nose. The more you have occupied and paying monthly lot rent - the better the overall cash flow for the MHP.
Thanks Dale, for your input. Its good to get advise from MHP owner's. Also, I have seen in some parks they have MH's that just seem to be sitting vacant. In most cases what is the MHP owner looking to do with theses homes?? sell??
An empty home is bad for the bottom line. My manager tries to maintain a buyer's list of those who are looking. As a home becomes available, she will call the person from her list and see about getting it filled. There are sometimes Title issues that have to be resolved first - a landlord's lien against the home. Sometimes a Title & keys are given in lieu of payment of back lot rents. Then we look at reselling these homes to someone who will take care of it better. My MHP was built in the 1960's so the lots are very small. We cannot afford to lose any homes out of the MHP as they can never be replaced - the homes they build today are way too big for the lot sizes we have. As long as there is a frame in place - the home can be rebuilt!
Thank you folks. I'm considering Lonnie Deals myself. Its good to hear others are successful with them. Thanks.
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Dennis Stout, I see you pulled up some really old posts for these deals, I think you're behind the times if you want to follow these "dealers". There is a new sherriff in town! Some of the stuff I saw in another thread were illegal when they were posted, it's not the way to do business.....
Oh sure, I did see that some posts were dated, but some are fairly recent, too. I've noticed comments on the subject (from multiple sources) are all over the place. I am visiting with a real estate attorney so I don't violate anything. Certainly, the market has changed as well. I appreciate you input, now and again in the future. Thanks.
The SAFE Act that everybody is nervous about is a federal law that requires states to enact their own version. Check your state's version, many states have exemptions that may be useful to you.
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Absolutely, go to the state versions, however much of this is still in limbo and while states may adopt their own regulations, the Act is adminsiterd by HUD and in the evnt any state statute does not follow the spirit or intent of the SAFE Act, the SAFE Act prevails. Exemptions are provided for in the federal Act as well. The real crunch is on non-owner occupied residential property, it does not apply to commercial lending and has provisions for homeowners selling their own home.
The Lonnie deals don't fit, as the Act covers MHs speciically and installment arrangements by "dealers". If buying say from an entity and purchasing bulk inventory you could easily make it a commercial transaction, but when you flip to an individual buyer, you'll have a problem.