Not only do you have to put up with the dreaded "dealer tax" (i.e. self employment tax), but the capitalization rules pertaining to overhead costs is also a tremendous burden.Consider this: You purchase a home for $30,000 cash.

@Matthew Irish-Jones the pro is that its once less bill.

Also...this thing is so poorly made that I see the dealer every other month (seems that way!).

@Matthew Irish-Jones, obviously I am a little late to the convo, but I am interested in rural rentals with acreage as well and it is hard to find much info on it.

I called the dealer and had a very poor call with him. 

Definitions.As used in this chapter, unless the context otherwise requires:(1) "Advance fee" means any consideration which is assessed or collected, prior to the closing of a loan, by a loan broker.(2) "Borrower" means a person obtaining or desiring to obtain a loan of money, a credit card, or a line of credit.(3) "Department" means the Department of Consumer Affairs.(4) "Loan broker" means any person who:(a) for or in expectation of consideration arranges or attempts to arrange or offers to fund a loan of money, a credit card, or a line of credit;(b) for or in expectation of consideration assists or advises a borrower in obtaining or attempting to obtain a loan of money, a credit card, a line of credit, or related guarantee, enhancement, or collateral of any kind or nature;(c) acts for or on behalf of a loan broker for the purpose of soliciting borrowers; or(d) holds himself out as a loan broker.A "loan broker" does not include any bank or savings and loan association, trust company, building and loan association, credit union, consumer finance company, retail installment sales company, securities broker-dealer, real estate broker or salesperson, attorney, Federal Housing Administration or Veterans Administration approved lender, credit card company, installment loan licensee, mortgage loan broker registered under Chapter 58, Title 40 and acting within the scope of its certificate of registration, or insurance company, who is licensed by and subject to regulation or supervision of any agency of the United States, the South Carolina Board of Financial Institutions, or other agency of this State and is acting within the scope of the license; and also does not include subsidiaries of licensed or chartered consumer finance companies, banks, or savings and loan associations.(5) "Principal" means any officer, director, partner, joint venturer, branch manager, or other person with similar managerial or supervisory responsibilities for a loan broker.HISTORY: 1992 Act No. 452, Section 1, eff June 15, 1992.SECTION 34-36-20.

The couple sells their stuff to the dealers.

Individually you and I would incur short term capital gain if we didn't hold the property long enough, or if we are "dealers" in real property.

Since a MLO and state license are not required in the states that allow unlicensed lease with option to purchase transactions, this may be an alternative at the present time for smaller operators who are doing limited numbers of these types of loans.If you are looking at doing less than five loans per year, there is another system that involves a formal joint venture arrangement that many Lonnie Dealers are using successfully and legally that should be explored.  

If you really wanted to do a bigger fund, you might want to research the possibility of using a broker dealer.