First Bank Loan Advice


#1

Hey Y’all,
I’m about to approach my first small town bank(s) about a MPH loan and am looking for some advice.

Anyone have any handy dandy presentations available that worked for them in the past? I heard the first 80% is fluff about how great MPH deals are (lowest default rates, multiple tenants (so not devastated if a couple tenants leave), minor repair costs when only dealing with TOHs, etc.

Any example presentations and pointers are greatly appreciated!

Also, do you have much luck trying to negotiate the terms?

Thanks,
Justin
justin.petersen@heartfordhomes.com


#2

Your time would be better spent finding banks that already lend on MHPs, than trying to convince them it’s a good idea. When reaching out, ask if they lend on MHPs, chances are they will say it depends which means they will if it’s a solid deal.


#3

That’s a quick and easy phone call to the business loan officer. Will do - much appreciated.


#4

@Jp1 , as per your question:

  • “I’m about to approach my first small town bank(s) about a MHP loan and am looking for some advice.”
  • “Any example presentations and pointers are greatly appreciated!”

My Husband and I own 2 MHPs.

My Husband had developed a wonderful relationship with a Local Banker whose Bank did loan on MHPs. This Local Banker was fantastic and he was really in our corner. Unfortunately, the initial MHP Deal did not go through.

However, about a year later we received a “Ratified Contract” on another Local MHP and we were excited to get the Loan through the Local Banker. At this point we already owned another MHP.

Unfortunately, this Local Bank’s Top Management had changed and they “did not” like MHPs. The Local Banker really went to bat for us and the Local Bank ended up offering a 3 Year Balloon. Since I am super conservative (and it was a Turn Around MHP), a 3 Year Balloon was not even an option.

Thus, I took it upon myself to start going door to door to all our Local Banks.

I found that either the Local Bank did loan on MHPs…or they did not loan…there was no middle ground.

Thankfully, I walked into one Local Bank and met a Loan Officer whose Father-In-Law had owned a MHP. Wow, what a blessing.

In the end we were able to find 3 Local Banks who offered to loan on the MHP…one had a 3 Year Balloon…one had a 5 Year Balloon…and one had a 7 Year Balloon.

We went with the Local Bank that gave a 7 Year Balloon. The Local Bank even reduced our interest rates a bit.

So morale of the story is…

  • “Get boots on the ground”…
  • Dress in your best and go around to all the local Bankers…
  • If one Local Banker cannot help you, they might give you a recommendation for someone who can help you. :slight_smile:

We wish you the very best!


#5

Great advice, first meeting setup for today with a local bank that currently does MHP. Thanks for your help.


#6

I called around 40 small town local and regional banks within 2 hours of my first park. Most banks said they do not loan. In the end 2 banks wanted the deal. I just crossed them off one by one. Some banks will sound promising but then fizzle out too. I had great credit, down payment and then some, and single family rentals too btw.
The banks that did want to lend were very impressed with that excel spreadsheet that is in the reference library that projects out 5 years based on various inputs. They had not seen anything like that before.


#7

This is promising to hear. Depending on who I talk to sometimes the 5 year projection is helpful, some times it isn’t, sometimes they want to see how the rental income plays into the deal, other times its just the land. It really depends on who I end up talking with.


#8

Is that excel spreedsheet only available from a boot camp or is it in one of the manuals that I could buy very fast?
I want to attend the bootcamp in New Orleans but need that worksheet now because I am submitting for a loan this week!


#9

I actually do not remember. I would email Brandon he would know.


#10

Pardon my ignorance… but who is Brandon? I haven’t been a member here very long.


#11

Personally, I think it’s more important to buy your first park correctly and get ok terms than buy a wrong park with great terms.

I don’t know how much knowledge you have with Mobile home parks but if you don’t have some sort of due diligence material you’re following, you could be overlooking items that could easily cost you ten or 20 times the cost of the home study course.

With the course you also get all the material and that amount credited off the boot camp when you attend later.

Good luck

Ken


#12

http://forum.mobilehomeuniversity.com/u/brandon_reynolds/summary

This is Brandon ( theres another Brandon on here but this is who @JCas06 is referencing.


#13

Thanks. I will email him.


#14

I just submitted my first loan applications to four banks locally. Talk about stressful. I am so not used to that process. I am definitely looking forward to a bootcamp so I don’t feel like such a fool when I go to buy my second park.