A True Story About Why Mobile Homes Are So Forgiving

by | BiggerPockets.com

The date was May 20th, 2002 and was standing (mouth open in shock) inside my “newest” mobile home acquisition; a 1981 doublewide located in a clean mobile home park.  When I originally looked and agreed to buy the mobile home I did my own inspection.  Upon inspecting the home I only quickly walked thru and failed to remove large furniture or area rugs to look at the condition of the floor!  I was now the “not so proud” owner of a mobile home with more holes in the floor than a slice of swiss-cheese.  If I would have known about the holes I would have made them give me the home for free or paid me to buy it.  Instead I figured I just had a $2,100 lesson for this junky mobile home that would surely need more money, time and repairs

I had been only investing in real estate for 3 months at this time.  I had no extra money to pay anyone to repair this mobile home and didn’t know the first thing about floor repair myself.  It was looking as if I was going to have a crash course in fixing floors.  This could take weeks or months before I ever see a PROFIT!  Plus the first month’s lot payment (pad rent) is coming due in just a matter of days.

So there were my problems!  

  1. I had a big, messy mobile home.  
  2. It seemed it would take months fixing the mobile to get it marketable for sale.

Here’s what actually happened

The first Saturday I spent an afternoon sweeping the home and removing misc furniture and scattered toys left behind from the previous owners (that’s the only maintenance I completed).  I ran an advertisement for “Handy Man Special” in my local newspaper.  The responses were immediate.

Within 3 days I found an approved buyer.  I sold the home to a very “handy” family for $17,500 @ 13.20% over 5 years. Why would anyone pay that you ask? Buyers want a nice home with fair payments!  The mobile home itself was messy, but had a solid foundation with great potential once cleaned and fixed.  And the buyers saw this!

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I made the home affordable upfront

Once the family passed my background checks, I sold the home with NO down payment or deposit, $550 a month for the first 2 months, and $750 for the duration of the payment schedule.

Understand I am happy to accept “sweat equity” instead of a down payment.  This “sweat equity” down payment shows many things, one being that the buyers are willing to make the house a “home.”  Once finished, the mobile home will have a great deal more sentimental value than if already clean.  I have found that this emotional attachment increases the likelyhood your payments will be in on-time every month.

This was when I learned a very valuable lesson

The fact that there are dozens of “motivated/on-time paying/job keeping/savings account having/no criminal record/drug-free” buyers that desperately want to own a home of their own, even a “fixer-upper” mobile home.  But, these serious buyers need someone to work with them!  Many “good” buyers have gone through a rough time in their past: bankruptcy, foreclosure, credit blemishes, etc.  Screen your people well because there are certainly more flakes out there than serious buyers!

There was so much stacked against this deal and it still makes me thousands every year for the past 8 years (The first family had to move out of state but left me with an almost mint condition mobile home).

Keep in mind that selling a “handy man” deal to a sweat equity buyer isn’t reserved for only mobile homes; compared to traditional housing which typically involves getting a mortgage, closing costs, taxes and insurance payments every month, mobile homes in parks typically only have a small out of pocket monthly park fee (+/- $200-$400).  This low monthly obligation for you means you’re financially able to “work with someone” who wants to fix the home, perhaps pay a discounted amount, AND you still net a positive passive cash flow of money every month.

– J. Fed

About Author

John Fedro

John Fedro has been investing in manufactured housing since 2002. John now spends his time continuing to build his cash-flow business in multiple states while helping others enjoy the same freedom he has achieved. Find John here.


  1. J Fed is back with a new moblile homes article!
    I love it!

    I really liked how you explained your specific experience in this article.
    To my knowledge, there are not a lot of Canadian real estate investors (I am Canadian) investing in mobile homes.
    As such, I don’t come across many investors who do this. Because of this, I find this content very interesting, as it is all new to me.

    In some respects, it seems similar to what we call here rent to owns. I think in the States, you guys call it lease options.

    Either way, great article J Fed. I hope to see more of these from you.

    Best Regards,
    .-= Neil Uttamsingh´s last blog ..What is Social Proof and how does it work? =-.

    • Thanks nick! haha, not many Canadians indeed. In fact not many investors total make money with mobiles (compared to more flashy real estate). Do Mobile homes in Canada have the same negative “trashy” stigma as they do here in the states?

      I’ll most defiantly keep it up! let me know if you need any topics covered. I don’t want to run out of idea to write about.

      “Rent to own”/” lease option” your right all the same.

      – John

  2. Hi John,

    Great post about your experiences with mobile homes. I can remember years ago, when I despaired of ever being able to afford a house, I looked into mobile homes. It was so discouraging to find out that the borrowing requirements were more stringent. It certainly looks like a great opportunity to do something with owner financing as you describe.

    .-= Elizabeth Bolton´s last blog ..Concrete Buildings In Cambridge =-.

    • Liz,

      I always thought the lending requirements ironic. If you can find a lender to lend you money on a mobile home the home better be less than 20 years old and you better have 20% down. And almost forget about lending to a mobile in a park.

      Absolutely, Owner financing is the greatest thing since sliced bread… in my opinion. 🙂 I’ve never been to a conventional bank to purchase a mobile home on land or in a park.

      Thanks for your comment!

      – John

  3. J-Fed,

    Mobile homes have a stigma here as well.
    Stigma or no stigma, if it is making dollars, who cares! Right?!

    In terms of topic ideas, here are my thoughts:
    I know that you touched on this briefly, however, I think it would be interested for readers to know how specifically you exit from these mobile homes. If it is through a lease option, what is the term of the lease options, conditions, etc.

    .-= Neil Uttamsingh´s last blog ..What is emotional investing? =-.

  4. So my first (only!) home investment is also a mobile. It also had floor damage (and mold…and dog pee )…which scared so many potential buyers that I was able to get it for $60k (rural California, city lot, top-of-the-line concrete flood-rated foundation).
    Mobile home floors do not tolerate ANY water. They fall apart. I replaced 100 sq feet of the floor by pulling up the existing & replacing it. If I had it to do over again I would just lay new subflooring throughout the whole house, right on top of the old subflooring. It probably would have taken a couple of days and cost about $1000, but would have saved time & money in the long run. BTW Legato carpet tiles — best thing EVER! Looks like “real” carpet, and I’ve already fixed several indelible stains between tenants by tossing the stained tile and putting down another — takes 5 minutes tops, if I ponder the stain, meander to the storage area & pause to pull a weed or two on the way back!

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