All Forum Posts by: John Pettas

@Jeremy Ramsay got your message, I'll shoot you a text and we can do a call later today when I get more information

That was the plan, so with expected rent increases and a possible increase in expenses that I don't know about yet, an offer price above asking at maybe around 100k, I shouldn't have a problem achieving my desired 10-11 cap rate. 

But if the trailers probably aren't worth $20,000 functional but not so desirable single wides, and I've paid $20,000 a piece for them, will I still be able to sell them to the tenants for $20,000 or more? I take it if I sell them for $20,000 to each tenant I am expecting to make money off the property solely by holding a note at 6-8% plus the lot rent until it's paid off?

I feel like a tenant will look at a rent to own contract and see that they're paying $20,000 plus interest and lot rent and say no way. Does anyone have experience have experience transferring 2/2 standard finished single wides over to tenants that they can share? 

Im waiting on the listing agent to get me more information about the units and expenses. 

I don't have much time to do that much on site due diligence, the owner is in his 70s owns 50+ units and wants to liquidate them and move to somewhere quiet so with the other two offers on the table I'm treating this as a highest and best until the end of today.

 The only thing that I was able to see is they appear to be in fair condition on the outside, I stood in a place where I can see that all of the roofs look fine, and I went inside one unit that needed no repairs. 3 units share 1 septic, 2 are on their own septic. Looking at 2 other mobile home parks for sale in the area show rents from 395-450, for single wides, so there's room for increase from the current $350.

Other than actual expenses and numbers, age and condition of units, insurance eligibility, what else should I be checking on?

A small 5 unit mobile home park came on the market yesterday and the agent said they already have two offers in hand. Seller has 48 hours to accept so I need to get my offer in today. The agent said that the seller is liquidating his portfolio to move and retire.

I am evaluating this based on NOI and cap rate like a normal commercial property, but some of my research says to evaluate it based on price per unit as well. This would be advantageous because I would like to transfer ownership of the units to the tenants in a lease to own and just collect lot rent.

For some numbers: List price is $89,000, 3 units rented at $350 a month, two units newly vacant this month. I drove the area and went inside one of the vacant units yesterday evening. The area has a lot of nice older homes, the neighborhood and houses all look well taken care of, and the major area that everyone in town wants to live in with a mall and the airport is 20 minutes away.

It's hard to find such cheap housing of course in a decent area close to everything and rents haven't been raised in 6 years, so I am running the numbers at $400/month per unit, 10% capex since I don't know the condition of the water electrical etc, 8% repairs, 4% vacancy, 10% property management. The vacancy is low because I spoke to a mobile home park owner in a much worse off area about 10 miles away said the same thing as the owner of this one, that they can have it rented out in a day or two and have a list of people the day they list them.

400*5=2000/mo*12=24,000*.68 (32% expenses)= 16320-632.61 taxes- 700 (estimated insurance)= 14,987.39

14987.39/90,200 (89,000+estimated 1200 cash closing)= 16.65 Cap

Finally to the question, I love the cap rate and will be fine with 10-11 so I can increase my offer so I can win the deal or make unit/park additions, but even if I offered $100,000 for the 5 units, there is no way that each used single wide 2/2 is worth $20,000 each. So does one just be happy with the potential cap rate and cash flow, own all of the units long term? I would clearly be overpaying for the price of each mobile home but the cap rate does justify the price. Any thoughts? Would I be overpaying at 100,000+?

@Jeri Artal I was impressed by the late evening phone call and have not had any lender do that, making me skeptical. I have lost a large sum of money after doing a real estate transaction from a craigslist ad, hence my increased apprehension. Thank you for the customer service provided. You finding this post on BiggerPockets and addressing it directly speaks volumes to me. I having nothing ill to say of your business or customer service provided, merely the method of our initial contact being craigslist makes me leery. 

@Bob Woelfel I have proceeded with my conventional financing needs doing just what you suggested, I thought I needed some private money for a quick closing on a commercial deal when I contacted Latra investments.

@Jeri Artal I will certainly be open to discussing future deals with you both in the future seeing that you are here on Biggerpockets. Thanks for speaking up.

So in my search for financing on three cash out refis or a possible HELOC in GA, and need for commercial funding in a multifamily deal in FL recently I have come across Latra Investments and Jeremy Richardson at Atlas Financial, offering a variety of loan programs to suit all of my needs, competitive rates.

I found Latra investments responding to a Craigslist post advertising private money lenders (red flag) and a man and a woman spoke to me on the phone late at night about my deals and how they find private money and private lenders, we got into some basic details and said that we should wait until I had the commercial property under contract to proceed. Their website is here: http://latrainvestments.com/

Jeremy Richardson at Atlas financial cold called me saying he saw me on a list of buyers looking for private funding on myhousedeals.com. I did put my information on there looking for private funds. On the phone I gave him the addresses and financials of the properties that I wanted to cash out on over the phone and told him I was looking at cashing out to purchase an expensive multifamily property. I received pre-approval bridge funding letters for my 3 properties with rates, monthly payments, and an invite to a loan funding portal that is requesting my last 2 months of bank statements.  The email claims they can close in 10-14 days and includes a video ad that they made.

https://www.atlasfinancialllc.com/

Nothing on scam reports, it's hard to even find latra investments with a google search. Are these lenders legit or has anyone used them before? Thanks for the help in advance.