All Forum Posts by: John Fedro

Hi all,

Sounds good! I'm voting for #2.

See you all there,
John Fedro

Well said Sam Parkins!

I don't have anything to add just wanted to mention that this is a great thread that every MH investor should read.

How great is BP that we can all get our questions answered like this. Christopher Bush just saved himself from a skinny and stressful first deal. :)

Best,
John Fedro

Hi Josh McCullough,

Thanks for the connection Joel Owens.

Congratulations on the package of 12 mobile homes you may be purchasing soon. This is very exciting!! This is hopefully a great deal and a wonderful find. I'm curious if the seller is a private person or a large company?

No matter what is said on the BP forum it would be a wise idea to speak to someone local in GA about your specific 12-home deal. The reason for this is that there are many moving parts to your transaction of 12 homes. Only having one LLC may not be enough, you may consider using Trusts, or any number of other scenarios.

I am not a Tax professional or Real Estate financial planner but it can be wise to have at least 1 LLC for your fast-turning properties and at least 1 LLC for your long-term holds.

Best of luck on your future MHP too. :)

Hope this helps.

Best,
John Fedro

Hi Sean,

Glad you heard the summit audio and thanks for reaching out.

Concerning the SAFE act and myriad of other Truth in lending laws I am no attorney and this is not legal advice. With that said there are rules that can be bent and there are rules that can be broken... The SAFE act and other TIL laws are neither. You either have to do things by the book OR avoid doing things that get you charged with violating this offenses in the first place.

What I mean by this is simple. If you are selling MHs attached to land you should always used a Licensed Safe Act approved loan originator and attorney in your state. This is the best protection you can get with homes attached to land. Now, concerning MHs in parks we buy with financing from the owner and sell with unsecured financing from a personal property trust.

The process I use has been modified a few years ago in response to these new laws. Before the SAFE act you could simply write any type of note you wanted with little consequences. These new laws are a good thing, you just have to know what the SAFE act (and other laws) say you can't do AND more importantly what you can do.

In addition I would like to mention that we are all resourceful investors. When new laws and economies come and go we roll with the changes and those of us that do not change, will go out business. Do not listen to all the DOOM AND GLOOM naysayers out there that say lonnie deals or other MH transactions are impossible. These deals just need to be preformed correctly and without any causes that do violate these laws.

That is my BP readers-digest short-version of my SAFE ACT talk.
Best,
John Fedro

Hi Sam,

Could you elaborate on your "Investor Model" for doing Lonnie deals? I am with Bill W as we're not sure about this term.

Best,
John fedro

Hi Joe,

Your goal of developing passive income overtime is just what mobile homes can provide. In my estimates your start up capital is more than enough to get your foot in the door with many motivated MH sellers in parks or with land.

Are you looking at purchasing mobile homes inside pre-existing parks or attached to their private land, or both?

Concerning your newbie advice question... Here is some quick advice. Get educated, connect with other local investors, make offers to sellers, and don't procrastinate. Also, share your stories here on BP.

Best,
John Fedro

Desmond Jackson, How much will you be in the home after all repairs? What state ate you located in? And... do you need to sell the home for all-cash or can you accept monthly payments for your profit?

You mentioned that you will either wholesale this home or rehab it... in my experience many newer investors can easily over improve the property and not get their money back out. Also, selling the home (quickly) for an all cash sale may be more difficult that you may think. Be ready to sell this home for payments if no cash buyers come your way within a few weeks (unless you have a deal worked out with the park where you pay no lot rent fees while vacant).

As far as a price goes you will not know what price you can sell any mobile home (in a park) for until you test your market for used-mobile-home-buyers and one actually brings you money. Cash buyers come and go with the wind. Get a general price to start advertising with by finding out what other comparable homes have sold for in the park... find out how long it took these comparable homes to sell. Use the comparables with the shortest "time on the market". Sandy gave a great suggestion to use the NADA guide, this will give you an idea of price but this "price/value" does not mean anyone will pay this amount for your home. An NADA guide is best used when obtaining insurance in my experience.

So long story short is to test your areas for cash-buyers right now while you are working on the home and paying holding costs anyway. Use newspapers or c-list as it is free and allow people to call you to inquire about the home. It is your choice if you show them the house or not, but at least you will be confident that in your area there are buyers for X bedroom and X bathroom mobile home at the sales price you are offering.

I hope this makes sense?

Brandon Turner Thanks for the shout-out.

Best,
John Fedro

Jon Klaus What a good idea! Biggerpockets- Austin! Sign me up :)

Bryan Hancock Congratulations on the twins!!!

Talk soon,
John Fedro

Hi Rob K and everyone,

Ha! My bad... thanks for the correction. I guess was just reading what I wanted to read. That's an inexpensive home!! :)

Best,
John Fedro

Hi James,

It is nice that you are looking into mobile homes as a way to provide affordable housing to so many in Detroit, while also helping yourself to some cash-flow.

If you can purchase mobile homes for near $5,000 (perhaps with payments to the seller) then it is possible for you (in theory) to sell these with payments for a profit. Although profit can be made in most areas there are a lot of variables that can make a good-looking deal a "pass" and if you are not aware what to look for and compensate for it can be tricky.

Like most folks said, stay in the safe areas. Also, concerning your question about how much profit is too much profit... when selling for monthly payments and a move-in fee, make sure the monthly payments are a steal for the tenant-buyer (TB)... make it so that the tenant-buyer will not want to leave because of affordable payments. Plus this will allow for TB to make any and all future repairs. Make sure you can profit near $300+ per month over the lot rent and insurance.

Hope this helps.
Best,
John Fedro