NOW HOLD ON JUST A MINUTE!!!
In my opinion, EVERYONE is off base here.
#1. Lonnie’s books deal with homes in parks - this one is on an acre. There is a book on this, and I highly recommend it: Investing In Mobile Homes With Land, available exclusively here:
http://www.creonline.com/catalog/c-229.html
I know these guys personally, and they are dead on with their system.
#2. With all due respect to the Moderator, I completely disagree with WilsonTaylor. This deal depends on comps, not how a MH is constructed, or the erroneous fact that only trailer trash will rent a MH. You state that appraisals come in @ 85K. Needing 14K in repairs, what will it comp out at? I’m betting that it would be higher than 85K. And even if not, 40 + 14 = 54, and compared to 85K ARV (if ARV is what the appraisal is based on) You’re still way ahead. Get it rented, and get a 70-80% mortgage against the property. It cashflows, you get the tax-free money (proceeds from the loan) to pay off your HML, or wherever the purchase and rehab $$ came from, there’s some left over to buy another, you get depreciation, and your property appreciates. BTW, how bad is it to need 14K in rehab???
Impossible to find investing funds? Bah. Start asking local banks/credit unions. Even higher interest non-standard lenders (American General, HFC, et al) would be better than HM. You may have to ask around, but there is money out there for an improved property consisting of a double-wide ATTACHED TO REAL ESTATE!! That is the lender’s security.
In today’s hot housing market, there IS appreciation in these land/home deals.
I have been doing Lonnie Deals for several years, and over the last couple of years, have also been doing L/H deals. I think that this is a deal - jump on it - after due diligence, of course: septic OK? water OK? no skeletons in the closet? The face value that you present, if accurate, describes a deal I would take right now.
Where is it located?? ;-)3