Feedback, How to Force Sale On A MH Park....

Feedback, How to Force Sale On A MH Park....

Investor, Entrepreneur, Educator · Springfield, MO · Member since 2009 · 21k+ posts · 12k+ votes

Seems we have a MH park still selling MHs with seller financed notes. A large park, not sue how many yet, but they sell a few a month in a great location. Land is more valuable than what the park can produce.

So, another investor is interested in getting the park which is not currently for sale.

The plan: Go in and find a MH for sale with thier screwy deal. Put money down to but it. Close the deal in thier office. Make a payment, then sue the crap out of them, violating the SAFE Act, MO. MH dealership requirements, and any other infraction found after we see the documents.

Bring the feds in, as they have turned a ton of properties in the past year as well as the state.

Now, while there are issues going on, the investor approaches them to sell. Figure the number of sales have already amounted to significant fines. It should be a motivation to run by the time we get done. Make an offer subject to any issues pending and then, make the issues go away through coordination with regulators, showing new management on the park and no more seller financed deals :)

I'd say HUD would go along so long as the violator was no longer in the business.

What do you guys think? While I know most here have not run others out of business before, like those who cheat and violate laws, this is a pretty well established way to bring a little pressure to scum bags and force them out. :)

Yes, it takes time, but no one is in a hurry!

Any suggestions? :))

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Flipper · Mission, KS · Member since 2009 · 23 posts · 8 votes
13y

My feedback would be that it sounds like a jerk-move, but if that is how your hypothetical buyer is comfortable doing business than more power to him. Personally, I would not feel comfortable ruining someone because they don't fully comply with a law that I'm not a fan of to begin with.

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  • Investor · Clairemont, CA · Member since 2011 · 3k+ posts · 2k+ votes
    13y

    I'm going to assume that the fact that you're involved means this is a little shadier (on the current owners part) than just selling a few mobile homes a month on owner financing and not using a licensed originator for the note.

    How do you deal with the current non compliant notes on the homes? Once you buy would you now be on the hook for those notes and have to refi them, or record a new note and forgive the balance on the old?

    From what I understood a note that was non compliant with SAFE act when created would essentially keep that issue even when sold meaning you would be on the hook for what the original property seller did.

  • Investor, Entrepreneur, Educator · Springfield, MO · Member since 2009 · 21k+ posts · 12k+ votes
    13y

    To answer that question, no, the business would not be purchased, just the property. The purchases could be left alone, the seller could deal with it or another way is to just buy out the tenant buyers would mean no harm, no foul, cash for keys. The land has a higher and better use or you could move in new management.

    OKAY, I'M NOT DOING THIS! The post was made as an example of RE hardball tactics that can be employed when there is a bad egg in the community. Tactics similar to this have been done to get some operators out of business. It doesn't have to be HUD or your state RE Commission or a DA that gets involved, there are those that can take out a shady operator and benefit from the efforts. There are "good sharks" and "bad sharks", the good ones, pilars of the community who have the means can usually squeeze out smaller players and do so on two fronts, one getting rid of some shady dealer and secondly, doing so for a profit. I've seen it done just to turn an area into a park for the public.

    Anyway, just wondered if there would be any comments where someone may think a slum lord or unethical operator can't be had, they can be. :)

  • Flipper · Mission, KS · Member since 2009 · 23 posts · 8 votes
    13y

    My feedback would be that it sounds like a jerk-move, but if that is how your hypothetical buyer is comfortable doing business than more power to him. Personally, I would not feel comfortable ruining someone because they don't fully comply with a law that I'm not a fan of to begin with.

  • Investor · Kalamazoo, MI · Member since 2009 · 1k+ posts · 495 votes
    13y

    I agree with Eric S. that this would be a jerk move unless there were a lot more involved other than stepping over the line of some stupid law and the fact that the property has a higher and better use. With that said, there are a lot of jerks out there and it pays to dot your I's and cross your T's because someday - someone IS going to play hard ball with you if you don't.

    There are just a handful of the large scale community owners that are fully compliant (with anything in my opinion)let alone the small operators. You would be amazed at the things you see and hear when driving the speed bumps and dealing with folks that want to sell their mobile homes!

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