Ok, I’ve reread all of Lonnie’s books and I’m ready to get
started. I posted an ad on Craigslist for a mobile home for
to get leads. I received a few different responses already
and have let them know that the one in the ad has been sold
but if they’ll give me their info then I’ll keep an eye for
something.
I received the following response back from a lady…
"Hi, Kevin.
My son and daughterinlaw are needing a home asap. They own
a piece of land on
South Western Street in Amarillo, TX. We could put down
$6000. Any size is
possible, but it needs to be in good shape. My son has a
good job at Tyson in
Amarillo but I would like to see them get in something with
payments in the
300.00 range. Can you help me? I could come to Lubbock
tonight to look at what
you have. I would really love to see photos if possible.
Thank you. "
Well, obviously I don’t have any homes to sell so I started
looking and found the following…
“3-2 MOBILE HOME FOR SALE $5500. CASH NO PAYMENTS. THIS
MOBILE HOME MUST BE MOVED. EVERYTHING WORKS IT IS ALL
ELECTRIC WITH CENTRAL HEAT.NICE AND CLEAN READY TO MOVE
INTO.”
How can I make this work for me? I’m thinking that I need
to look at the 3-2 and talk them down from the $5,500 price
then turn around and sell it to the lady for around $10,500
with the $6,000 down and $4,500 at $250 a month.
But, I don’t have any cash to buy it first then sell it.
How would you guys work this?
Re: Help me make this work - Posted by Dr. B. (OH)
Posted by Dr. B. (OH) on July 22, 2011 at 14:44:44:
Kevin you are on the right track. The ad showed there is at least some demand. Did you figure out from the callers what kind of down payment they had or what price range would work best for them, monthly income etc.
As Shawn says, don’t get involved in this one. Here is the reality of what you would need to do a deal like this with little of your own money.
a) the home really is in good shape.
b) a home with no A/C is ok with the lady.
c) she is prepared to spend $2-3000 to move it. (not likely since she only has $6K to put down).
You would give the $5500 guy $50 bucks for the option (written agreement)to buy the home for $5000 within the next 2 weeks. Meaning he can’t sell it to anyone else for 2 weeks. Then you would get the buyer to look at and agree to buy the home from you for $5500 or more. That would be worth risking your investment of $50.00, no? The problem with this particular deal is she (and the son) doesn’t have enough $$ to buy a home AND move it, neither do you. Not to mention Shawn’s and Lonnie’s point of not doing a deal on private land unless you own it.
Keep taking those calls and finding out what they want. Meanwhile get away from the computer and drive the speed bumps. Find a home in a park you can work in (not a war zone park).
Re: Help me make this work - Posted by Shawn Sisco
Posted by Shawn Sisco on July 22, 2011 at 11:40:58:
Re-read Deals on Wheels. Only Buy and sell in parks until you have so much money coming in from your Lonnie Deals that you can’t keep it all loaned out on Lonnie Deals -then, and only then, you need to buy some lots.
Don’t move a home that you have financed onto private property (non-park). Unless you hold mortgage on the land as well, when they stop making payments- you will have huge expenses facing you. Re- read DOW and this time pay attention.
Ok, Dr B I want to try this and here is why.
The buyer already has separate money saved up for the
moving expenses.
I found another home that IS in good shape and that has
central heat AND air.
Where do I get the “option to buy” form?
Do I just try and get the buyer to go ahead and give me
the down payment so that I can give the seller his
money and then get all the forms filled out after?
I guess my question is “How do I get the seller his
money from the buyer and keep my part of it?”
In my mind, this would be more of a flip.
Buyer I found has $6,000 down payment, seller I found
wants $5,500 for his MH. Buyer would pay for moving
expenses to her land.
I’m already $500 ahead on the deal “if” they stop
making payments in the future.
Re: Help me make this work - Posted by Dr. B. (OH)
Posted by Dr. B. (OH) on August 09, 2011 at 12:31:07:
Nice try. This is one of the downsides of people with cash. They can go anywhere. Just lost a buyer with $18K cash. She went and bought a newer home than mine for the same price. Never even looked at mine bc it is a 1993 even though it is in great shape and I’d have sold it to her for $15K.
Re: Help me make this work - Posted by Dr. B. (OH)
Posted by Dr. B. (OH) on July 26, 2011 at 19:27:43:
Make up an official looking document on your computer with the title “Standard Option Agreement” or such. Leave lines to hand write in the year, name, model, address, serial # etc. Say in plain English what you want it to say. Use spell check AND reread it before printing. I carry carbon paper with me so I can make a copy for them.
Make up a sales form “Standard Sales Contract” for the lady with the Name, model and serial# etc. of the home. Have the seller leave the door unlocked and vacate the premises for an hour so you can show the lady the home. Tell him this is standard procedure (he’s got your 50 bucks, no?).
you said what I was thinking - worst case you make 500
Get it locked up, perhaps close with everyone at the table
Let the seller know that you are looking to sell for a little profit. Get the seller to sign an option to buy at (negotiated price)
Then sign a sales agreement with buyer - get their 6K, pay the seller, then sign a prom note, along with somoe kind of agreement to enter their land to repo if they default. OR get a lien on the land for the balance - I’ve never done this, but have always found it to be sound business theory.
Good job - I did a deal (only cash sale, no note) like this and cleared 14K cash. NO MONEY OF MY OWN!!!