Ideas About Financing
Hi everyone,
I've found a nice mobile home park for 425,000, but 20% down would be 85,000. Does anyone have an idea of how to come up with that much downpayment. The park would pay for itself in 10 yrs.
MB
Will the financing be owner finance or a lender?
If a lender ... then are you already qualified for a loan? The lender will want to verfiy that yes in deed you have the $85,000 for the downpayment.
There are the standard prorations on from the seller rents, deposits, security, etc. also misc. escrow credits to buyer could offset some actual cash required to close ... but you still need a large amount of your own money.
Cheryl Lopez
Hi Ms. Lopez,
Thanks so much for the information. That's what I thought.
Marsha
Marsha --
Do you need to talk to a mobile home park lender?
If so ... try U.S. Business Finance 1-886-202-0305 ask for Ken . website http://www.fastcommercialmortgages.com
Run by your ideas with Ken and see what he can offer you. He should be able to help you.
Cheryl Lopez [ Edited by cheryllopez on Date 08/21/2004 ]
Hey MB,
You might also want to look at a more creative financing angle, where they would sell the park via owner financing by creating two liens, and selling the first lien at closing to a note buyer for cash proceeds.
Depending on the details of the park and the deal, I believe it is very possible you could reduce the DP down to 10% or15%, but the question is do you have ANY amount to put down?
The seller wins because they can sell their park this way, payoff any underlying liens, get cash at closing, AND keep the second for cash flow, reducing tax burden depending on how the numbers work out, and you win because creative financing is more geared to this kind of collateral, and your DP requirement could be reduced, allowing you to keep tens of thousands in your pocket at close, vs. more conventional lending.
Let me know, hope this helps, Dave
Thanks Dave and Cheryl for all the good information!
Marsha
Depending on your sellers needs, you may be able to do even better than a traditional bank loan. I will assume that the seller owns the park outright (no Liens). If you get a bank loan, that is like cash to the seller. Out of the cash comes the capital gains taxes, leaving a lump sum to do what with? Jumbo CD bringing 1.5%? I just bought a small park for $265,000.00 by giving the seller 20k in cash (3.9% fixed til payed for Credit Card) and financing the balance at 5% fixed with minimal closing costs. Created a win win situation.
Good Luck,
Shawn(OH)
sure thing Marsha, glad to be of help
My best, Dave