Done Deal: 3/2 Singlewide Mobile Home In a Park

Stories and adventures about my experience investing in mobile homes.

Done Deal: 3/2 Singlewide Mobile Home In a Park

(Note: Since I’ve received a lot of requests for more case studies, I thought I’d make a post on another one. Enjoy!)

For this deal, the sellers had actually found me via word of mouth. The good thing was this home was in pretty good condition, just a few cosmetic issues. However, the bad thing was this home was in the wrong park – the same exact park as my $2000 Nightmare. So, what to do?

Going in, I already knew my exit strategy. Should the home be in good condition and we are able to work out a deal, I would move the home to one of my favorite parks.

(Note: Regarding moving homes, I have a deal now with my favorite parks where they pay for my moving costs if I fill a lot. At this point in my career, I receive free lot rent as well. However, it has not always been like this. In the beginning, what’s going to matter is building relationships which do take time).

Due to my prior experience in this particular park, there was NO way I would keep this home in the park – the type of clientele it attracted just did not fit my personality.

(Note: Before going into any deal, you really need to have an exit strategy and stick with it. So many times, I’ve seen folks who go into deals and just kind of “wing it” not having an exit strategy at all – this is a recipe for disaster).

In any case, I made the appointment to go meet with the sellers. I found out they needed to sell as soon as possible due to a job relocation. They had heard about me through a friend and needed someone to buy their home who was serious. I was the first person they called.

(Note: This is the power of networking and having a good reputation in the community. Time and time again, I see folks who chase deal after deal just focusing on the numbers at hand without first taking the time to build relationships. Due to my formal sales training and experience as a business to business sales executive, I have learned the importance of building relationships. By taking the time to build relationships first, the deals will eventually start to come via referrals and word of mouth marketing. Bypassing this step will only lead to frustration).

After going through the home with the sellers, I knew this was a home I was interested in. They took pretty good care of the home and there weren’t too many issues – just a few cosmetics. So, I proceeded to ask the sellers how much they were thinking of selling the home for. They told me at first they wanted around 15k, but since they needed to sell right away and knew my reputation for closing quickly – they would sell the home to me for 10k.

Looking around the home, I already knew this was a fair deal. But, I wanted to make it even better so I asked the sellers if they could throw in the outside storage shed as well. They agreed as they told me they didn’t need to bring it with them either and also offered to leave the leftover paint for the home (both inside and out).

(Note: When negotiating, remember – it’s not always about price. Sometimes there are other concessions you can ask for to make it a win/win situation for everyone).

Since it was very close to the end of the month, I proceeded to ask the sellers for one last concession – could they cover one month’s lot rent to give me time to move the home? And, guess what – they agreed!

So, we all agreed to the deal. Now, it was all just a matter of paperwork. But, guess what? There was another obstacle in the way (as there are always) – the home was not in the sellers’ name.

After they showed me the contents of the folder containing the paperwork for the home, I soon found out that the home was still in the prior seller’s name. All of the paperwork had been done to transfer the home from the prior seller to the present sellers. However, the paperwork was not submitted to the local housing authority.

Upon further inspection, I soon found out that there was a bank lien on the home. Looking at the name of the bank, I knew this bank had gone under during the mobile home banking crisis circa 1990s.

(Note: Yes, the mobile home industry had their own real estate bubble back in the 1990s. There was a point in history where anyone could get a loan on a mobile home – they call this the “fog in the mirror” days. Basically, as long as you lived and breathed (aka can produce fog in the mirror) – you could get a loan. Due to this issue, there were many defaults and repossessions that had taken place thus causing many of these banking institutions to fail).

So, the first thing we had to do was to contact the prior seller and track down the banking institution that had taken over the accounts of this bank. Good thing this was a local transaction – the sellers told me they knew the prior sellers (as they used to work together) and they still lived in the area.

Together, we called the prior sellers and explained the situation. They could not believe the home was still in their name – they thought the issue was taken care of years ago. Even the taxes were still in their name but they knew they were being paid by the present sellers.

In any case, the prior sellers told me they had paid off the loan years ago – the bank just did not take the lien off of the home. (Usually, this is just a matter of paperwork on the bank’s end). So, the prior sellers told me they would try to figure out which banking institution had taken over the accounts of their bank and see what we need to do. I agreed to help them out as I knew there were only a few possibilities. (Only a few institutions survived – mainly the larger ones).

After a week of calling around, the prior sellers finally called me and told me they found out an attorney’s office out of state was assigned to handle their account. We both contacted the attorney’s office explaining the situation. They looked up the account in their records and confirmed the home was paid off. They agreed to send over the necessary paperwork needed to remove the bank lien.

It took a few weeks for us to get all the paperwork straightened out – I felt like I was in the middle of things being pushed and pulled by the present sellers (wanting to close the deal already) as well as the prior sellers who wanted this taken care of as well. But, once we finally got it done – we were able to do the title transfer from the prior sellers to the present sellers and then to me.

All in all, it definitely was a good learning experience. The key was to be persistent (especially with the attorney’s office who needed to send out the paperwork) and to maintain a calm demeanor (not always easy when there are other parties calling you – i.e. the present sellers and the prior sellers, asking what is going on with the deal!).

In any case, once we did the paperwork – everyone was happy. The prior sellers had peace of mind this whole situation was finally taken care of and the present sellers were able to move (as they were already to go) and move on with their lives. Now, all we had to do was move the home.

(Note: I will say, the park manager of this park tried to convince me to leave the home in the park. Since we already knew each other, I really had to play it cool and stick to my exit strategy but at the same time maintain the peace. Again, this is a learned skill which is more of an art than an exact science – it’s not what you say but how you say it that counts).

So, I squared things away with the park manager – we left things on good terms. And, I was able to move the home without a hitch.

Here’s a pic of the home leaving the park:

Once we moved the home, we took the necessary steps to get the home in ready condition. There was not much work we needed to do, just cosmetic – mainly painting.

Here’s a pic of what we did to the kitchen:

Before

(Note: The blue tape you see above is painter’s tape which I use to secure all cabinets in a home to prepare for a mobile home move).

After

And, here are a few more pics after the fix up work.

Living Room


Kitchen

Hallway

Bathroom

Bedroom

After the home was put on the market, I found a nice family for it. They were eager to live in the park as they were already looking in the area – they just lived down the street.

They passed the necessary background check for the park as well as for me – I received $1500 down and it cash flows in the $500/month range for 10 years.

(Note: Due to the economic times, I had to take less down on this one as compared to previous deals. In addition to what is put down, residents who qualify still need to come up with first month’s lot rent and a deposit for the park. That’s a serious chunk of change for most folks. Though, the important thing is the home is in my favorite park with a good paying family).

Though this deal took a bit of time getting together the necessary paperwork and involved more parties to the transaction (i.e. prior sellers, present sellers, attorney’s office, etc.), all my hard work paid off. It made for another nice and relaxing cash flow payday for many years to come.

Happy investing!

p.s. Feel free to leave comments on any post either here and/or my Facebook Page. Comments are always welcome, thanks for reading!

(Disclosure: Some posts may contain affiliate links.)

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