Negotiating with 2nd and 3rd mortgage holders for a MHP

[Kris Fox]

I'm looking at a 10-unit mobile home park that has a tax value of 260k. It has total notes as follows:

160-170k 1st
80k 2nd
6k 3rd

for a total of 246-256k

How would you go about negotiating with Junior lien holders assuming this park will not sell for more than 80% (if that) of tax value given what I know about my area?

[Kent Anderson]

Kris,
For starters…
Are the first and junior liens private or institutional?

If private...

1. Are payments current?
2. What are the terms of each note, original amount and remaining balance?
3. Was the original loan balance all cash or some equity, points or other property thrown it to the loan?
4. Are the loans secured by other property as well? If so, what?
5. Number of late payments on each?
6. Are the lenders sophisticated or unsophisticated lenders?
a. What are the lender/borrower relationships for each loan?
b. Friends, investor, family, bank etc.
7. Do the private lenders know how to manage/operate a MHP?
8. Why did they loan the park owner money?
9. Are the private lenders nervous or happy about their loan?

If institutional, is the lender a local bank where you can negotiate with a decision maker, verses a voice/clerk on the other end of a phone?

Most importanly, what is number one Key Issue for each of the the parties involved? Again, just one and answer in as few words as possible.

Of course, There is plenty more to learn, but a good start to get the ideaa rolling.

Looking forward to your response,
Kent