How to buy a mobile home

Question

After hunting and hunting for a deal and calling tons of different mobile home parks and figuring out what their lot rent is etc., I've finally found a really good deal that doesn't need too much rehab!

Now I've come to the incredibly knowledgable BP forums to help me with my next step, which I really have no clue how to proceed. What are the watch outs for when buying a mobile home trailer? I've heard things mentioned in general like back taxes, owed lot rent, owed utility bills etc but what do I need to check on for my due diligence? Do I just get the title and have them sign it and I go to the DMV and then I'm good? I'm going to rehab and flip, do I need property insurance or pay property taxes?

Also things to inspect on the trailer? I've learned some great things from @John Fedro's podcasts but would love input on this as well.

Thanks in advance! Very excited to finally take action and not just read/listen all day but want to make sure I'm minimizing as much risk as possible!

Rachel H. · Answer

@Braden Coleman When purchasing mobile homes or any type of investment property, each investor has their own set of criteria. You'll probably need to determine yours before going into any type of deal. If you've found one with not too much rehab and think you can handle it, the next step is to look at the neighborhood. Can you do business here? And work with the type of clientele the park attracts?

Other than what you mentioned (i.e. liens, back taxes owed, lot rent, etc.), I look at the seller above all else. Is this person someone you can trust? Is there a mutual relationship of trust and respect? If the person does not seem trustworthy and/or looks like they are hiding things, I pass on the deal no matter how good it looks.

In the end, it's not only about the deal but the person I'm working with. I just don't want anything to come back to me in the future. And I make sure that doesen't happen by working with folks I feel comfortable with.

Hope that helps. Good luck with the deal!

John Fedro · Answer

Hi Braden,

Good advice from Jason and Anthony above. Please see my thoughts below in bold with regards to your questions.

After hunting and hunting for a deal and calling tons of different mobile home parks and figuring out what their lot rent is etc., I've finally found a really good deal that doesn't need too much rehab! First things first, congratulations on this tentative property! Seriously great job with regards to being proactive and patient to find this opportunity. Moving forward you will certainly fine-tuning your numbers and be able to help more and more sellers and buyers. This is the first of many mobile homes for you! However as an old mentor of mine used to say, it is not closed until it is closed.

Now I've come to the incredibly knowledgeable BP forums to help me with my next step, which I really have no clue how to proceed. This made me chuckle a little bit. Ideally it is good to have your forward plan and exit strategy clearly outlined in your mind and much of the step-by-step process you will take. With that said I admire your ready fire aim actionable mindset. What are the watch outs for when buying a mobile home trailer? Definitely make sure that you know what you are buying and test everything inside possible. Make sure you clearly know what repairs you will make before reselling or renting this property. Also make sure you understand the location in the park management as well as their application process moving forward. There are of course other things to look for but this is a good start. I've heard things mentioned in general like back taxes, owed lot rent, owed utility bills etc but what do I need to check on for my due diligence? Yes, you ideally want to make sure you know about all of these things. If there are back taxes or fees do it is not a dealbreaker however this money will likely come out of the sellers profit. Do I just get the title and have them sign it and I go to the DMV and then I'm good? This depends on your state or where you will be investing. In Indiana you'll want to reach out to the local county treasurer's office and local bureau of motor vehicles for more info and help transferring titles. I'm going to rehab and flip, do I need property insurance or pay property taxes? The answer, like most things in real estate, is “it depends”. Insurance inside of mobile home parks is not commonly required by the community but may be wise. However you will likely pay some sort of taxes or registration fees if you transfer the home into your control.

Also things to inspect on the trailer? I've learned some great things from @John Fedro 's podcasts but would love input on this as well. Thanks for following along. I do hope that these podcasts have been somewhat helpful to you thus far. I put out a couple YouTube videos as well that may be helpful.

Thanks in advance! Very excited to finally take action and not just read/listen all day but want to make sure I'm minimizing as much risk as possible! Keep up the great work. Keep us posted moving forward.

Talk soon, John

Anthony Dooley · Answer

@Braden Coleman there is no secret stuff to look for. Just know that there is no such thing as a perfect house (or mobile home). Base your offer with the knowledge that there is going to be things that need repair. Ask the seller about each tenant and their past delinquencies etc. Don't over-analyze it. This is either worth buying or it isn't.

Braden Coleman · Answer

@Jason Dillard that is a really good point

How to buy a mobile home

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