I have been researching the MHP business for about a year. For anyone on the fence, I have attended Frank & Dave’s boot camp and found it to be incredibly helpful and well worth the investment. I can’t imagine any way it could have been done better or more helpful. The home study materials are spot on and a great reference to go back to again and again.
I am looking for a bit of guidance/opinion regarding financing. I have the equity to put in to my first purchase, however am not 100% clear on financing the transaction. I am a younger guy and do not have a substantial liquid net worth or experience owning income producing property. Given these facts, it appears that I would not be a legitimate candidate for bank financing, which would leaves me concentrating on seller financing. The questions I have are as follows:
At what point does it make sense to introduce seller financing to the process? i.e. Should that be part of your initial conversation with the seller or does it make sense to wait until later in the transaction?
What is a reasonable down payment percentage to include in an initial offer?
Given that one of the advantages of MHP ownership is they require less intensive management than other property types, what would entice a seller to want to enter into seller financing? i.e., It seems like it would be preferable for a seller to continue to operate the park and collect the full NOI as opposed to the interest payments on the note. Any advantages that I could use to help persuade potential sellers would be great.
How would you make the seller comfortable that you can competently operate the park after closing, given the lack of experience?
Thank you in advance for your thoughts!