Has anyone flipped single wides in parks for all cash? i have heard of people paying cash for a singlewide in a park and then immediately flipping for all cash for a profit without touching it. also, i have heard of people buying and fixing up the mobile home then selling for all cash. Is this a waste of time or is there some money to be made doing this? I am wanting to get in the game with little risk. I don’t want to buy for cash and sell on terms because my capital will be gone pretty quickly. let me know what your thoughts and ideas are.
You have heard of these cash flips because they do exist. On average, I have sold for cash one out of every five homes I’ve sold. That means I took a note on 4/5 homes.
Getting up enough capital in the beginning is an issue. Use a HELOC if you have one, borrow money (paying interest, of course) from family or sell partials of your notes to get your money back. Actually, if you use the last suggestion, you only use your own money once for a brief period of time.
Just wondering on the 4/5 notes you’ve taken back, have you sold any of them off to investors. The one institutional investor I’ve talked with indicates only double wides that are real property, attached permanently to the ground, will be sellable.
Also, advertising and selling to individual investors could run afoul of SEC.
I presume the “institutional investor” you talked with was a loan officer, an employee of the institution. For the most part, they know NOTHING about private $$. You can sell a note or partial on a pallet of toilet paper if you can create one AND find a buyer for it (preferably written on some T.P.). Always consider the source of the information you are getting.
I have held all of my notes thus far. However, I have two people I have recently pitched selling partials to who are showing some interest.
Advertising a note sale will get you into trouble with the SEC. I have commented on this elsewhere. Selling to individual investors will not.
Much as Steve pointed out there is a very active group of investors looking for good (recourse) MH paper… The problem is it takes experience and networking face-to-face time to find the people that are in to MH paper. Advertising is a BIG no no which leaves MH based events and word of mouth.
These lenders DEMAND experience and a proven track record, they in most cases ARE NOT investing in the asset as that’s the last thing they want! Non-recourse less than 50% of the note value is typical, I’ve gotten up to 100% of face with full recourse and typically just pull my money back out which is 25-50% of face.
Tim,
I’ve successfully flipped many a MH but it’s not big bucks, the average is probably $1k in cash a month. For about the last year I’ve found it nearly impossible to flip singlewide MH’s as my main clients were park owners whom are now buckling down due to the lending crunch that most commercial borrowers are currently facing… No cash = no flip
I get the impression that you’ve not read (or understood) Deals on wheels which I highly recommend you read (again?) and follow it to a T for your first 6 or so deals. Once you’ve got a few good notes in portfolio it doesn’t take much to get the money ball rolling. There is no easy button with this business.