All Forum Posts by: Jeff Copeland

This listing is for a mobile home that appears to be in a mobile home park, which is very different from investing in a single family home. 

The mobile home is considered a vehicle, with a title much like your car. As such, it isn't considered real estate. 

In some cases, a mobile home is attached to the land like a SFH and you can finance it much like a SFH.

But in the case of most mobile home parks, you'd only be buying the trailer, not the land, which means:

1. You'd likely need cash or some kind of private financing for the mobile home (seller financing is often offered in these situations) since it isn't real estate, and

2.  This is the real kicker: On top of your acquisition, financing, and operating expenses, you'd have to pay "lot rent" of probably several hundred dollars per month to literally rent the land than the trailer sits on (Note: I believe the lot rent is $780/mo, per the listing).

There is no "get rich quick" scheme that will get you a 20X return in a short period of time. 

If you invested $55k in a portfolio earning a healthy 8% compound interest, you'd get to $1M in just under 40 years. 

But I'm assuming your real question is How long would it take to turn $55k into $1M?. And I'm guessing you want to speed up that 40 year horizon?

Therein lies the beauty of real estate...

If you invested in stocks, bonds, or just about anything else, your $55k would get you...well, $55k worth of stocks and bonds or whatever. 

But by strategically using leverage, your $55k could get you $220k worth of real estate (at 75% LTV).

If your $220k property appreciates at a very reasonable 8% annually, your get to $1M in under 20 years. 

Of course you have to account for the financing costs, etc. But on the other hand you could conceivably get better financing terms (96.5% LTV with FHA for example), and/or much better appreciation than 8% in some markets.

This is just a crude example to show that real estate can get you there in half as much time as many other options. 

They frown upon external links here in the forums, but (aside from Bigger Pockets of course) one of the best resources for new landlords is Evict TV (easy to find with a Google search) - literally hundreds of videos about landlord-tenant issues and how to address (or prevent) them. 

It's produced by a law firm in Florida (I have no affiliation with them), so some of the legal details are Florida-specific. But there is enough general info there to make every episode a must watch for new landlords!

There is a corresponding podcast called The Property Manager's Podcast by Harry Heist (same content, different format). 

Welcome! Tons of great info here. Be sure to check out the bookstore and podcasts!

An applicant cannot refuse to accept your result. They either meet your requirements or they don't. 

Of course you have to make sure your requirements are legal and fair, and applied equitably to all applicants. But if applicants don't meet them, you send them an Adverse Action Notice as required by law, and move on. It isn't a negotiation in most cases. 

I will also add than it is frighteningly easy to obtain fake pay stubs, and it can be tempting to let your guard down when you need to fill a vacancy. Employment/income verification is crucial if there is any doubt whatsoever, and I would find it doubly concerning if an applicant resisted or discouraged us doing one. Don't get bullied into skipping it. 

Honestly, I think the biggest mistake new investors make is analysis paralysis. Time is your best friend in best friend in real estate, so there is a very real cost to doing nothing (aka "waiting"). 

And a corollary to that is thinking everything is going to go exactly to plan, and freaking out or giving up when it doesn't. It never will. Your numbers and projections will never be 100% accurate, and there will always be unexpected issues and problems. 

Real estate (in the sense of owning and holding real estate long term for real equity accumulation and generational wealth) is a get rich slow scheme, so you have to be in it for the long haul, be prepared to roll with the punches, pivot, and have multiple exit strategies, and realize that a single eviction or repair is not the end of the world. One the contrary: it's a normal, expected, everyday part of being a landlord. 

Keep your eye on the prize. 

There might be tax advantages to running the revenue and expenses through an LLC (talk to a CPA), but from a liability and asset protection standpoint, if the LLC doesn't own the property, it may not help much. If someone breaks their leg or dies on your property, the landlord (and the landlord's homeowners insurance) gets sued. 

So a more pressing concern might be what does your homeowners insurance policy say about running an Airbnb out of your basement? You may need better or different insurance coverage, to include an umbrella policy. 

From a Fair Housing perspective, it is definitely a best practice to publish your criteria, and even more important that you adhere to them and treat every applicant exactly the same. 

If your requirements aren't published, applicants can claim you are churning application fees or playing favorites based on a protected class (race, color, religion, national origin, sex, age, familial status, etc.) rather than based on published criteria. And it's hard to prove otherwise if your requirements are kept secret.

The one caveat here is be careful how you state your requirements when it comes to criminal records. There have been dozens of lawsuits against landlords and PMs from felons based on HUD's disparate impact guidance (we go so far as to reference and link to the HUD guidance in our published screening criteria), and you cannot make blanket statements such as "No Felonies".

It can be difficult to enforce or collect from co-signers, but it does give you another throat to choke, as well as leverage with the tenant (because they usually don't want you contacting their co-signer for payment). 

You absolutely have to verify credit and income of the co-signer. What would be the point of having a cosigner if the co-signer has a 300 credit score and no income? 

The idea is for the co-signer to be more qualified than the tenant. 

Ask them why, and make sure you get a legit answer.

A couple of reasons I have seen companies do this: 

1.  A company renting out a house for their employees (for example, 4 employees building a bridge or a parking garage, 12 month project in a city away from home, renting a house is cheaper than hotel rooms and per diem). This can be a legit way to get your house rented, possibly at premium rent, to a stable entity for an extended period of time. In this scenario, you might consider hiring a local landlord-tenant attorney to draft and/or review the lease, to make sure you are as protected as possible and have some recourse against the occupants if they cause problems. But people in this scenario are usually there to work, not to party.  

2. People who want to lease from you long term through a Corp or LLC, so they can turn around and do short term rentals (essentially STR subleasing, or arbitrage) with your property. This can be a major red flag, because it probably isn't your intended use, it may not conform to zoning, and it could result in increased wear & tear, complaints from neighbors, and code violations.