All Forum Posts by: Ryan Hehman

One common red flag is if a lender requires an upfront fee before accepting an application or offering a term sheet. Legitimate lenders get paid at closing and disclose their fees on the settlement statement. During the process everything should be transparent and you should not have to come out of pocket before the deal closes. If there are any discrepancies, make sure you get clarification before signing. In addition, normal due diligence, plenty of communication, previous reviews, and gut feeling all go a long way towards comfort and success in dealing with a private lender. 

If his business occupies 51% or more of the space in the building, then SBA is most likely the best option for this, and it's possible to do 10%. I can help with this as well, and happy to talk specifics at any time. 

Hi Roberto, I'm here in PG County and happy to connect to talk shop as well. 

Hey Bruce, pretty exciting opportunity to come across. Having a good amount of cash reserves as you do will definitely help with getting a good rehab loan from a hard money lender. Most hard money lenders will provide 80%-90% of the total cost of the project, including acquisition and construction. Some investors I work with only use the hard money for the acquisition to avoid the fees and inspection delays during the construction period, when the lenders provide construction draws. Interest rates can vary from mid 7% to 11% apr, depending on your experience, FICO score, and the property. The terms are usually 12-18 months, so you need to either sell the property at the end of the term, or refinance into a long-term rental loan. 

Some investors balk at using hard money because of the higher interest rates, and indeed it can be risky if you have thinner margins or if the project takes longer than expected. I recently had to go through a 9 month zoning variance on a flip and if we had hard money it would have eaten into all our profits. A private loan from a friend, family member or acquaintance can be easier to manage for this reason, but has its own pitfalls as well. 

I would be happy to talk more specifics about your project if you like at any time. 

I'm not currently making a huge effort at this but a couple of years ago, I was able to connect with the Director of Economic Development in a smaller city nearby which was fruitful. For some reason, he was also in charge of the list of vacant/blighted properties in town. He was happy to give me the list to reach out to the owners because the city desperately wanted something to be done about these properties. Out of a list of 50-75 homes or so, I made one good connection which has turned into 3 deals. 

In addition, I'm currently working on a flip in my own city which we've owned for 14 months. Because of skewed lot lines and setbacks we had to go through a variance process which took 9 months. We're almost finished now, but I'm sure that knowing people both on the city council and at the county level would have helped speed things up, or just provide us with more information for planning. I think this sort of thing tends to work out in ways you don't expect down the line.

Try Pointer Ridge Management for Baltimore. I have a couple of townhome rentals with them, and have been with them for ~4 years. Hired them to handle a particularly difficult tenant and they've been great. Very responsive, transparent, and have never felt like they've charged unnecessary fees. Best of luck!

I'd also be interested in connecting - Silver Spring, Northern PG County area

Hi Adrienne, I've invested in mobile homes in Maryland over the past couple of years and would be happy to talk with you about my experience if you like. There's a bit too much to write here so feel free to reach out personally. But I've renovated and re-sold 12-15 mobile homes over the past couple of years. I've gotten homes as cheap as $99 even! I've resold some with owner financing (probably 75% of them) and some for cash. It's a nice niche with good potential profits and cash flow, if you spend the time and learn some of the particularities. I stopped this year because I had to travel so far around Maryland to find good deals and wanted to focus on sales of single family homes closer in DC and the MD suburbs.

@Eric Bassett brings up great points above. It's still definitely possible to rent out a mobile home on land for good cash flow. With the water supply lines underneath the home, it's important to wrap them in heat tape and make sure the skirting is always secure. Good insulation underneath the home is mainly helps keep the heated environment inside sealed so your HVAC is not working overtime.

Manufactured homes can absolutely be a maintenance headache. The subfloors are typically a composite material and any leaks or moisture inside can rot them quickly and they crumble. So a lot of homes will have soft spots. Also hardware and doors and other little replacement items are odd sizes and so you may have a hard time buying off the shelf home depot products to make repairs. But you can definitely replace subfloors and otherwise renovate to make it more sturdy for a renter. A lot of folks say stay away from these homes, but a lot of folks have made good money with them as well.

To find comparable mobile homes sales try mhvillage.com, craiglist, facebook marketplace and other classified ad-type sites. You will see some mh's on the MLS (so it shows up on Zillow) but these will be the more expensive ones since a lot of agents pass on them.

If the price is too high, still go check out the home, start a relationship with the owner, and make an offer that you think makes sense. They may say no which is fine, and you can follow up in the future or ask if anyone else in the park is considering selling. MH park neighbors are usually tight-knit. Depending on how motivated the seller is, you can also offer to make them payments while you fix and resell. 

$425 lot rent is very low (may not stay that way for long) and you could sell on payments to make good cash flow. Look for comparable apartment rentals to see how much you might be able to charge per month. 

Before making an offer, though, make sure to talk to the park manager while you're in the park and talk to them about what you intend to do. It's not advisable and usually not possible to buy and resell a home in a park without cooperating with the PM at some level. 

Good luck! Feel free to PM me if you have any other questions.