Why not rent until you recoup your investment and then resell after you first tenant moves out? This way you get your money back quicker, but you do have the headache of being a LL?
you'll be responsible for things that break down on the property. the beaty of lonnie deals is that they own it so you dont have to be a LL, just collect payments. Also if you rent it out, you'll have the same issues as selling it on a note. It's similar monthly payments, so why not just sell it on a note for less headaches? With a note you can also get a DP and start a new deal.
I'm a total newbie but i have done a ton of research in setting up my LLC to do these deals. These are in no particular order and not all problems, just my thoughts on these issues:
1) insurance
Paying insurance on a vacant MH is going to be ~4x as expensive as if it was occupied (roughly 200/yr). Ideally you get a trustworthy buyer and they maintain insurance after they buy it, while you hold the note. You can add a default clause or you can set up an escrow type of thing. Same for taxes. I don't know what's best, to be honest. At first I'll be using a default clause. If there are problems, I will move to creating an escrow for T&I.
2) problem buyers
-damage
-not paying
-etc.
You just have to make sure every deal has enough margin for you incase soemthing bad happens (which no doubt it will). But I think the most important part about this is going to be screening people. There are screening service companies that do credit/criminal checks for $35. Then just use intuition to screen as well as you can. But again, not having close margins is very important, in my opinion.
3) park managers
As said above, some parks are not receptive to dealers. It's going to be important to present yourself well and get a foot in the door to the park. There are two parks around here that are extremely unreceptive and where I will probably never do a deal in. I put an ad in the paper, something like "wanted -mobile homes will pay cash, up to $5000" I got a handful of phone calls from one of those parks. Now, on the other side of the classifieds is a phone number to the owner/manager of the park that says "2&3 bdrm's for sale (xxx) xxx-xxxx". If I had to guess this manager is making the sellers lives miserable and forcing people into allowing him easy lonnie deals. This is clearly speculation but an example of how a manager can screw you over. He's not letting people into the park unless they buy through him.
4) What lonnie didn't tell me
It is illegal in Lonnie's home state to sell mobile homes without ~$1100 in licensing fees. Why didn't he tell me this? Why did I have to find this out on my own. In anycase I beleive that I can personally still profit huge in my area, however I think it's bad form. I'm also wondering what else I'm going to learn along the way (as I've pretty much only set up the business and ran into a problem during my first step)
