All Forum Posts by: JJ Neerman

@Mike McCarthy, thanks much; that helps.

So, the strategy either way seems sound based on the purpose for which to use the funds. Good deal.

The next part is trying to determine which resources may be best suited to provide one of the two with respect to mobile home properties.

@Lane Kawaoka, thanks for the feedback. Am I to understand that a HELPC maybe a good short-term plan, and then try to convert the heloc to a first mortgage, is that right? Or did I miss a step?

I have two properties in the Tulsa area of Oklahoma I bought in August; both were land and mobile home purchases. One I paid cash for, the other I put money down and the owner carried back the balance. The twist on the owner carry is that the deed does not show a mortgage lien held by the seller.

So, I want to BRRRR these. Are there options to either get a first mortgage for each (or one for both), or get a HELOC for one or both? I know having mobile homes presents more challenges for financing options.

The purpose for cashing out is obviously to payoff the owner and go find a multi family to then also BRRRR.

Thanks in advance for any support, guidance and/or suggestions.

@Micki M. - i glossed over an important question you had asked...you asked about the appearance that the income doubles from year one to year two. thank you for catching that. i'm trying to understand why that shows as such. i wonder where the error is in the calculation? it must be an input in which i made an error, but i can't find it. the first year's should be around $114k. i may have assumed half the income for improvements.

@Derek Robinson, I really appreciate your input. These are all very valid concerns with good suggestions. I’ll cersiny take your feedback into consideration.

I am finding that finding funding sources to be more challenging, and your assessment concerning banks and credit unions are inline with what I’m seeing. It seems that I’m going to have to get creative should this deal move forward. 

With respect to the lagoon & well and from an order of magnitude perspective, what kind of money are we needing to consider for reserve should  full replacement be required? 

I’ll defintelly ask about county water and sewer at least being available to the land; I doubt the previous owner had water and sewer tied in if it is available in the area...hopefully I’m wrong.

Regarding price, I asked how he landed on his asking price to which he said a combination of cap rate and what he thought was a fair value for each lot. My only concern was he figured a lot price for each lot regardless of activity. IMO that’s fine from a speculative point of view; however, I think it’s reasonable to pay a fair rate for the occupied lots and discount the rest...which is how I got to my number. Isn’t it reasonable that when buying we’re buying current output rather than potential? 

Thanks for the feedback; I’ll generate a new set of questions to the seller based on your info.

@Justin Hammond all good and legit Qs; actually, I'm trying to pry this info from the seller. the little info he's provided so far is as follows with respect to your Qs:

IR: ?; fixed rate; 30-year; Payments: $1079 (P&I, Ins./Tx's.)

with respect to rent, they are going for similarly sized homes between $1200 and $1500...I think $1250 is reasonable for this one.

the Balance owed is about $132k, and the value is between $160k and $175k.

When I mentioned a POA, that was the first time i saw him pause...so, i need to tread lightly and bring him along on that with caution.

I should have read the end first; i would have PM'd you this info! haha...so i'll return your offer: feel free to PM with your feedback; i appreciate your input! 

G'evening, BP Fam! Please see link to a report at the end of my post i generated for a mobile home park i'm considering. I used the BRRRR calc and made some assumptions. It seems to look possible and reasonable to me. Some explanations on seemingly low expenses are as follows:

1. Property Manager is bartering rent for PM services (e.g. light maintenance and common areas, etc.)

2. Common Water is on a state-inspected/certified well

3. Sewer (liquid waste) is also on a state-inspected/certified lagoon

4. About 1/3 of the current MHs have been converted to owner financed sales to tenant, so home maintenance is on the tenant/buyer

the seller's asking price is $550k; however, the tax record shows he bought it in DEC-2018 for $350k. I have no problem letting a guy make some money for a few months, but not a killing for a couple months of very limited hands-off ownership. i think $400k is at least a fair first offer.

Additionally, i've been told that based on the current cash flow of the property, that i stand a good chance of being able buy (finance) this property primarily on the merit of the cash flow alone. If anyone has experience with this, i'd certainly invite input with how to buy based strictly on cash flow-ability. I did throw in some guesstimate numbers for presumed purchase costs, but would like to get into this property with as little out of pocket dollars as possible.

Provided my assumptions are reasonable, I'd like to make an offer, and then confirm the deal by completing MH Park due diligence to verify the assumptions...but that's for another discussion thread! ;)

Let's see if it's a swing and a miss or a possible home run!

View report

*This link comes directly from our calculators, based on information input by the member who posted.

@Paul Swales - is this contract sufficient for a “subject to” deal? Is there any additional info or documentation that would be necessary to ensure a subject to deal closed here in OK?

I’m working with a seller right now and am hoping to get a contract using subject to.

@Mike M. - that’s the goal, brother! I’m a project manager for a global combustion and emissions controls company. I enjoy the work and my friends and colleagues; however though the salary is nice, I don’t believe it’s paying me the value for my execution expertise. As an example I’m managing multiple multi-million dollar deals at a single time, but yet am compensated at a single, flat rate. I get it; but I can use my same skill set building an investment portfolio and can be compensated directly in line with my execution efforts. Forgive the side trail, just eager to gain understanding in this arena so I can transition from employee to entrepreneur.

@Mike Mendkoff I’m getting a 40-unit (potential) mobile home park; actively 27-units. It seems to be cash flowing very well for the seller, and my analysis thus far suggest it would cash flow between 35% and 45% of revenue pending the financing strategy, of course...