All Forum Posts by: Brittany L.

The law in texas is that foreign entities transacting business in texas must register in state. However, what constitues transacting is not technically defined, the state instead chose to define some of what is not considered transacting business. However, the criteria for triggering the franchise tax is lower so that more businesses are subject to it. (Texas wants it's share of your pie!)

Here is the exact wording from our SOS page:

Transacting Business in Texas: A foreign entity that is transacting business in Texas must file an application for registration with the Texas Secretary of State. Whether an activity constitutes "transacting business" in Texas is often difficult to answer. Texas statutes do not define “transacting business;†however, Texas Business Organizations Code (BOC) § 9.251 lists activities that are not considered transacting business. Case law and Attorney General Opinions are useful in determining whether or not an entity is “transacting business†in Texas. The secretary of state cannot issue opinions on whether an entity is transacting business in Texas or needs to file an application for registration.

The level of a foreign entity’s activity in Texas that subjects it to franchise taxes is lower than the level of activity that subjects it to registration requirements. An entity that is doing business in Texas for purposes of franchise taxes may not necessarily be “transacting business†in Texas for purposes of registration with the secretary of state. If you need assistance in determining whether a foreign entity is subject to franchise taxes, you can submit a “Texas nexus questionnaire†(Form AP-114) to the comptroller of public accounts. Based on the answers to the questionnaire, the comptroller will issue an opinion about whether the entity is doing business in Texas for franchise tax purposes. For more information, visit the comptroller's website or contact

Link to our Secretary of state section that talks about this: http://www.sos.state.tx.us/corp/foreign_outofstate.shtml

So I got in contact with the seller and it turns out they have a portfolio of 40 or so mobile home notes. I found one in particular interesting due to the equity and the buyer is making two pymts/mo.

1999 Fleetwood "Festival" 16' x 76'
1,178 Sq. Ft.

$21,000 Sale Price
$14,804 Current Balance
$ 236.54 P & I
$ 49.00 T & I
12.75% Interest Rate
120 Original Term
104 Pmts Remaining
5/6/2008 First Pmt Date
5/6/2018 Last Pmt Date

I loosely told him over the phone I wanted a 20% return or more, which would be a little over a $11,500 purchase price. Any thoughts on this one? I think I will get Marc's opinion on this one as well.

Thanks Jon!

You have been so helpful to me!

I meant singlewide

No land packaged, just the home. Not sure of the age, size, lot rent yet. I know the home is a double wide.

By my calculations if I discounted the note 15% off what is left, the note would only pay at a yield of 18.65- is that correct?

Here are my calcs:
I=1.21 monthly
PV=28,400
PMT= 474.38
n= 20
remaining bal = $25,451.48

plugging that back in as PV, with same pymts and new n of 80 I get a 1.55/mo for I, or 18.65/yr. What do you guys think of the yield? It seems low to me only because the yield from originating notes on mobiles is so much higher.

Are there any other questions I should ask the seller? I have never purchased a note before.

Thanks!

Oh, I forgot to mention that this is a mobile home note.

Hello all!

I am looking at my first note purchase and am not sure how to determine a reasonable offer. Here are the details I have on the note:

$29,900 Sales Price of property when note originated
$ 1,500 Down Payment
-$28,400 Original Balance
-$ 474.38 Principle + Interest Payment
-$ 50 Taxes & Insurance
-$ 524 Total Monthly Payment
107 Months Original Term
87 Months Remaining
14.50% Interest rate on note

So, I know I would need to find out what the current value of the property is, the payment history of the buyer, their credit score. Any other information I need to ask for? Also, any suggestions on what to offer or how much to discount it?

Thanks everybody!

Alan,

I am curious. Have you used or have any experience with the Texas Manufactured Housing Association forms? If so, have you found them useful, or would you still recommend having forms such as promissory notes, purchase and sales agreements, etc. drafted by a lawyer? The TDHCA keeps recommending them.

Jon,

I am in Texas too and starting in mobiles. Let me tell you, lawyers specializing in this seem to be hard to find. I called about 10 local commercial RE lawyers, all of which referred me onto other lawyers they thought might have some experience- none of which did. I finally called up the head of the texas commercial RE lawyers board and he did a state search and came back with 3 names for me. I will be calling them tomorrow to see if any fit the bill. PM me if you want the names, and let me know if you want to wait until I have screened them to pass on my findings.