Financing For a MHP That is 100% Parked Owned?

[FinanceGuy]

Mobile Home Community in an area of less than 20,000, but a strong base population of 100K about 40 miles away.

The community is under 50 homes, is 100% occupied, and 100% owned by the park.
What lenders are financing these deals?

The purchase price is under $1,000,000.

Any suggestions?

Looking for all the help I can get.

Thank you!

[David Oxhandler]

"We are not in a housing crisis... we are in a finance crisis."

Conventional lenders generally like to finance no more than 80% of the value of a park. With the meltdown of the credit market it is impossible to find a lender that will consider the value of the park owned homes in that formula. There are thousands of small parks for sale across the country, with park owned homes,like the one you are interested in. The only ones that are being sold are selling for low cash prices or with seller financing.

If you think the park is a worthwhile investment you can terrify the seller with a low offer or you need to make a presentation to the seller and convince him that it is to his advantage to carry the financing.

Seller financing provides many advantages to the seller:

1- Nearly ever seller says he wants all cash, but few need it. What the typical seller wants is the most net cash from the deal. Often, the seller has to pay closing costs, title insurance, broker fees, and the balance of the existing financing.

2- While the seller will not get a huge chunk of cash he will reach his goal. He will be removed from the in the daily hassles of operating of the park BUT will continue to get a fixed income. If there are 4 empty homes he will still be paid the same monthly guaranteed income as if all the homes were rented.

3- Seller financing is his ONLY chance to make a sale without taking a big hit on price. There is no doubt that a seller can insist on and receive the highest price when offering flexible owner-finance terms. In many cases, the seller can receive more than the fair market value of the property by offering "soft" terms. People are always willing to pay a premium for non-qualifying financing.

3- Many seller finance options can be crafted to offer great tax advantages. Talk to your tax advisor.

4- Fast Closing. Nothing holds up a sale more than a new conventional commercial mortgage. It can and will take months for a buyer to qualify and close a new loan. Since most standard real estate contracts contain a financing contingency, your seller may end up back at square one if his buyer does not qualify.

5- Owner-carry sale makes sale of the park unique. Furthermore, an owner-carry transaction can be consummated in a matter of days, since there is no appraisal, underwriting, survey, or other nonsense involved. In many cases, the seller will be able to sell and close the property himself, saving thousands in real estate and mortgage broker fees.

For A Definitive Guide for Investors' Best Kept Secret - Mobile Home Parks see MOBILE HOME WEALTH : Part II

[FinanceGuy]

David,

Thanks for the feedback. I understand everything that you said, but this seller will not offer any financing, so the route of bank financing is what this deal is looking for.

Even non-conventional lenders - what company would lend on this property?
Do you know any lenders that would finance this property?

Thank you!