Needing advice on Mobile Home investing & Financing!!!

Mobile Home Park Investing
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Needing advice on Mobile Home investing & Financing!!!

Lindsey Run
Greenville, SC · Member since 2013 · 9 posts · 0 votes

Hi everyone!! I am a total newbie to real estate investing! I have a million question... So here it goes...

I found a nice mobile home property that I would like to buy and rent out for extra income. I hope to eventually buy a good many down the line so I can quit my "day job" and finally do what I feel like I would LOVE. First off I'm a little worried about investing in mobile homes. SOOO many people have told me investing in mobile homes is a bad idea. Well I don't have a lot of start up money and I can buy a decent/nice mobile home (on its own land) for 30k and under. Around here if the mobile home is in a nicer area you can rent a 3br/2ba for $550/mo give or take some. Is this a bad idea? Would you suggest mobile homes for someone wanting to have rentals with very little money to start off with?

My husband is a handy super man so when it comes to upkeep I will rely mainly on him. I feel like upkeep up a mobile home would be cheaper than a stick built home.. Do you agree?

Other HUGE problem is I cannot seem to find anywhere willing to finance a mobile home. I have called many local banks. There have been a few that said they do but it would need to be our primary residence or a double wide. If or when I find financing what type of loan would you suggest? Are there 30yr loans for these? A lender won't even speak with me to find these answers out since they don't offer financing for them. I just want to know round abouts how much I will most likely have to put down and how much my payments will be with everything included (insurance, etc.) I am wondering if I ask $550/mo if I will be profiting enough after all is said and done. I would like to at least be profiting $200/mo or so to make it worth it.

Any advice for me would be WONDERFUL. I am totally new to all of this and want to absorb your information and advice like a sponge. I just want to get my foot in the door and become successful without getting in over my head. I know that this isn't going to be easy by any means. I love a challenge, but I don't want it to break my pockets.

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Tom Goans
Real Estate Investor · Englewood, CO · Member since 2013 · 988 posts · 258 votes
13y

@Lindsey Run,

I have a history of owning, buying, selling, and renting manufactured homes. I have also been involved in the development of manufactured home communities and mobile home parks.

My experience has been terrific for numerous reasons.

I highly recommend investing in manufactured homes, especially for the beginner. The financial commitment is much lower and the return on the investment can be much, much greater. Holding costs are pennies as compared to a site-built property.

Your husband should find them easy to work on with most of the supplies available and in stock at either of the two big-box stores.

Of particular note, thoroughly learn the real estate business - every aspect and every segment.

Also, take business classes. Knowing how to successfully operate a business is critical and will make your life easier.

Then, learn everything there is to know about manufactured homes. Everything. My best education came when I attended a national manufactured home show. I got to meet the many manufactures and learn all the subtle differences between them.

Then, learn and understand the target market better than they know themselves. This includes learning their earning and spending habits. This one suggest is true of all segments of the real estate business.

Learn how to communicate with tenants. Not just legally, but also the best way to communicate without alienation. This will greatly improve your success on finding good tenants and collecting money.

Last, but most important, learn the laws, federal, state, and county where the property is located. Read every word of every statute. If you have questions, ask a lawyer for explanation ... they speak the same foreign language as the law is written. This suggestion is critical no matter what segment of the real estate business you pursue. The real estate business is very complex. Knowledge is key to easier and enduring success.

As for financing, the best is owner financing. I highly recommend doing lease with option to buy. This gives you an opportunity to give the home a test drive before the financial commitment. It also gives you a test drive. I recommend using two separate agreements, one for the lease and a separate for the option. Your attorney will be helpful here.

Here is a consideration. I had an excellent experience owning and renting homes in parks. The cost is less. Moreover, become friends with the park manager. This person will become your free property manager, adviser, and will be an excellent source for future investment opportunity leads. Every day you read on this blog of people seeking sources. Your friend the park manager can be the only person you need.

Best wishes for a long and enjoyable experience.

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  • Tom Goans
    Real Estate Investor · Englewood, CO · Member since 2013 · 988 posts · 258 votes
    13y

    @Lindsey Run,

    I have a history of owning, buying, selling, and renting manufactured homes. I have also been involved in the development of manufactured home communities and mobile home parks.

    My experience has been terrific for numerous reasons.

    I highly recommend investing in manufactured homes, especially for the beginner. The financial commitment is much lower and the return on the investment can be much, much greater. Holding costs are pennies as compared to a site-built property.

    Your husband should find them easy to work on with most of the supplies available and in stock at either of the two big-box stores.

    Of particular note, thoroughly learn the real estate business - every aspect and every segment.

    Also, take business classes. Knowing how to successfully operate a business is critical and will make your life easier.

    Then, learn everything there is to know about manufactured homes. Everything. My best education came when I attended a national manufactured home show. I got to meet the many manufactures and learn all the subtle differences between them.

    Then, learn and understand the target market better than they know themselves. This includes learning their earning and spending habits. This one suggest is true of all segments of the real estate business.

    Learn how to communicate with tenants. Not just legally, but also the best way to communicate without alienation. This will greatly improve your success on finding good tenants and collecting money.

    Last, but most important, learn the laws, federal, state, and county where the property is located. Read every word of every statute. If you have questions, ask a lawyer for explanation ... they speak the same foreign language as the law is written. This suggestion is critical no matter what segment of the real estate business you pursue. The real estate business is very complex. Knowledge is key to easier and enduring success.

    As for financing, the best is owner financing. I highly recommend doing lease with option to buy. This gives you an opportunity to give the home a test drive before the financial commitment. It also gives you a test drive. I recommend using two separate agreements, one for the lease and a separate for the option. Your attorney will be helpful here.

    Here is a consideration. I had an excellent experience owning and renting homes in parks. The cost is less. Moreover, become friends with the park manager. This person will become your free property manager, adviser, and will be an excellent source for future investment opportunity leads. Every day you read on this blog of people seeking sources. Your friend the park manager can be the only person you need.

    Best wishes for a long and enjoyable experience.

    1Reply
  • Deadrick Colbert
    Investor · Easley, SC · Member since 2013 · 248 posts · 51 votes
    13y

    @Lindsey Run, what city and state is the mobile home in?

    0Reply
  • Lindsey Run
    OP
    Greenville, SC · Member since 2013 · 9 posts · 0 votes
    13y

    @deadrickcolbert In the Greenville, SC area. I'm also looking around Greenville like Simpsonville, Greer, Piedmont, areas.

    0Reply
  • Lindsey Run
    OP
    Greenville, SC · Member since 2013 · 9 posts · 0 votes
    13y

    @Tom Goans

    Thanks so much for all the great information!! You are right, I need to get some more knowledge under my belt. I'm just so ready to hurry and jump in! I will take all of your advice for sure.

    0Reply
  • Lindsey Run
    OP
    Greenville, SC · Member since 2013 · 9 posts · 0 votes
    13y

    @Deadrick Colbert

    In the Greenville, SC area. I'm also looking around Greenville like Simpsonville, Greer, Piedmont, areas.

    0Reply
  • Deadrick Colbert
    Investor · Easley, SC · Member since 2013 · 248 posts · 51 votes
    13y

    Lindsey,

    I live in Easley and work in Greenville. I've made money on mobile homes. Just like everything else, it depends on the deal. I would not count on any appreciation, but they can make good rentals and are a good way to begin investing. For financing, call Beckey Coley,lending specialist for manufactured housing. If I can help further, let me know.

    1Reply
  • Aaron Kinney
    Real Estate Investor · Lexington, SC · Member since 2012 · 25 posts · 11 votes
    13y

    @Lindsey Run

    My dad and I are doing rent to own mobile home and land properties in the Columbia, SC area. Financing has been very difficult. I brought up this topic not too long ago in the forum:


    Financing of Mobile Home with Land Property

    We have used personal lines of credit so far to fund most of our deals and have struggled to find any banks to lend money on this properties. Good luck in your search!

    0Reply
  • Robert Minnella
    Investor · Newberry, FL · Member since 2013 · 11 posts · 2 votes
    13y

    Lindsay If I were you, this is what I might do.

    Your hubby, being a super handy man, would be a blessing. Try to find a parcel of land of about an acre for sale by owner financing. If you can find one with well and septic you may not have to update them.

    Find a mobile home dealership that has sold a new home to someone who needs to get rid of theirs. You can find some really great deals on them. Sometimes the owner will even pay for you to take it off their property. Just make sure that it can have wheels and axles affixed to it to roll it onto your new property.

    A mobile home installer will have to be hired to set it up and plumb it to the existing septic. If your husband is as handy as you say, then he should be able to sign on as owner/builder to hook up the electric and a/c or pick a friend that is familiar with electric or a/c.. You might even be able to have the steps thrown in along with the home. Just make sure they will pass code.

    Set a limit on how much you are willing to pay for one of these homes. Expect to pay no more than about $10,000 or set a budget price that you are comfortable with....perhaps $4000.

    Good luck and keep it simple.

    0Reply
  • Lindsey Run
    OP
    Greenville, SC · Member since 2013 · 9 posts · 0 votes
    13y

    @Deadrick Colbert

    Thanks a ton, do you know who she works for so I can find a number for her?

    @Aaron Kinney

    Thanks for the info. Looks like line of personal credit is going to possibly be the only option, unless a miracle happens.

    @Robert Minnella

    Thanks for the advice, I never would have thought of doing it that way! Great Idea to go to a mobile home dealership!

    0Reply
  • Deadrick Colbert
    Investor · Easley, SC · Member since 2013 · 248 posts · 51 votes
    13y

    @Lindsey Run, my apologies she is the loan officer at Certus Bank in Greenville SC.

    1Reply
  • Tim Stodieck
    Fort Stewart, GA · Member since 2013 · 8 posts · 1 vote
    13y

    I am also a newbie like yourself, and I also will be investing in mobile homes, go to mobilehomeinvesting.net and or search for john fedro in youtube. You can find all your answers there.

    0Reply
  • Ron Kelley
    Barstow, CA · Member since 2013 · 51 posts · 7 votes
    13y

    @Lindsey Run

    Hi Lindsey, here is an blog that addresses some of your concerns about MH, if you haven't already read it.

    WHY INVEST IN MOBILE HOMES WITH LAND OVER TYPICAL SINGLE-FAMILY HOMES?

    I found it very informative.

    0Reply
  • Bill Gulley
    Investor, Entrepreneur, Educator · Springfield, MO · Member since 2009 · 21k+ posts · 12k+ votes
    13y

    Good advice to call a local MH finance type.

    Another way is to sell to a dealer who does financing along with your buyer so that all they do is the paper work, they buy and pay cash then sell and finance. Negotiate with them on their work.

    MHs that don't pass secondary lending requirements as to age and being taxed as RE are hard to finance conventionally. And, a MH is a depreciating asset, much like a car.

    IMO, unless you are a dealer, the best money in MHs is in renting them for as long as they are standing.

    Options and other financing on MHs is a real compliance issue now, get an attorney, this is no DIY matter any more! :)

    0Reply
  • Rob Becker
    Overland Park, KS · Member since 2012 · 10 posts · 1 vote
    12y

    Are you looking for homes on land, or in communities? If you're looking in communities, here are some lenders you may want to look into:

    http://21stmortgage.com

    http://www.chattelmortgage.net/

    The fun thing about mobile homes in parks is that they're financed similar to cars, but not exactly the same. Look into chattel loans and lenders. That should help you dig up more sources of financing. On land, your best bet may be to seek out folks with retirement money that's not earning much and get them to self direct some of it and lend it to you.

    0Reply
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