Just won a MHP on eBay

[Jordan Moorhead]

I just won a MHP on eBay and now need to piece together the transaction. Any ideas on how to do due diligence and what to ask for?

[Bill F.]

@Jordan Moorhead cool cool. Fairly simple deal since its small and doesn't have private utilities. . 

Who owns the homes, the park or the tenants? 

Also do you have a signed P&S?

I'd start off with market analysis to see what the average lot rent is in the area. This will drive the value of the park itself and is what kills most deals. 

Generally speaking you want to ask for, 

-All permits/licenses.

-Two years of utility bills (water, sewer trash) and who pays them. The longer amount of time will help you figure out what is "normal" and if they are any leaks. 

-Insurance policy

-Financials: tax returns, P&L, bank statements. With parks this size, don't be surprised if you have to built your own P&L from their bank statements and expenses or modify their P&L to back out personal expenses they run through the park. 

-Three years of CapEx and Repairs

-List of problems with the park. 

-Rent roll and Leases with dates of occupancy and last 2 rent increases. 

-Personal property that comes with the park. This includes titles to POHs. 

You can request all of this in writing, but depending on the seller, talking on the phone about the park before you write up your formal request can save you tie because you 1. don't ask for things they don't have and 2. learn about thing to ask for you would not have otherwise known about. Most park owners like talking about their park and its history.