What effective methods have you guys used to find Lonnie dealers in a specific city or at least nearby one?
You can pull a list of personal property for a county and see many at the same address but with incremental numbers (e.g. 100 Sweetwater Ave, #10, 12, 14, 16, etc) not owned by the Park. Sometimes in big cities you can do a data dump and refine the data yourself, other times with smaller counties they have to do it for you after pulling some teeth.
For our benefit why are you seeking them out?
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Great idea thanks! I’m looking at a park with a lot of vacant lots and I know I would sleep easier if I knew there were Lonnie dealers ready to jump at the park in question . I love the Claytons Cash for Keys program idea but from what I understand, it’s not 100% guaranteed and is contingent upon my experience running parks.
I don’t use the program today, so I’m not the right guy to ask.
Off the record I think it can augment other strategies to get people in the Park quickly - but I would prefer financing approaches where I am not personally liable for someone else’s ability to pay. Keep the note with the owner only and then no strings attached if you want to resell the Park. The program seems reasonable, but this is the one thing I don’t like. Their track record seems good so far, but I’d like to see it extend further. I’m curious how large their portfolio was in Flint, MI for example and how that worked out for the Park owners.
If you’re in a strong market try to sell them for cash, but it’s really hard once you get above 10-15K. Test ads + bandit signs to see how much traffic you can generate with this…
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@DPW, as per your post:
- “What’s the most effective way to find Lonnie Dealers in a certain city?”
As a MHP Owner who invited a Lonnie Dealer into our Turn Around MHP (when we first purchased the MHP) I would suggest to be very, very cautious of Lonnie Dealers.
Lonnie Dealer’s primary objectives are in total opposition of your primary objectives as a MHP Owner.
A Lonnie Dealer wants a warm, paying body in the home.
A MHP Owner should have much higher standards for Tenants.
If the MHP Owner allows any Tenant from the Lonnie Dealer, the Lonnie Dealer Tenants will end up running off your best Tenants.
It seemed like our Lonnie Dealer got their Tenants from the local Bail Bondsman.
We ended up booting out our Lonnie Dealer.
We wish you the very best!
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Sorry to hear that @Kristin and those are all great points! I would definitely attempt to have some sort of screening control in the contract between me and the Lonnie dealer. I can see how dangerous it could be if I’m not careful.
You first must screen the Lonnie dealer and if he does not measure up you do not let him do business in your community. As Kristin mentioned their goals and yours are opposite. Make it very clear that he will be 100% responsible for the tenant in the home until such time as the tenant owns that home. Any problems with the tenant the Lonnie dealer will receive an eviction notice. The Lonnie dealer is your tenant and the sub lease tenant in the home is the Lonnie dealers tenant.
You must make it very clear to the Lonnie dealer that any tenant he finds for the home is screened by you, the same standards of screening are used as for any tenant in the community. The Lonnie dealer will not like these conditions as many applicants he brings to you for screening may not pass your approval.
Personally I would never allow a Lonnie dealer in my community but it is extremely unlikely a Lonnie dealer would ever come to my community as the homes are too expensive…
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That makes total sense @Greg. What do you guys recommend is the most cost effective way to bring in homes? Frank gave me some excellent ideas. I’m just curious what you guys do as well?
I agree with @Greg ,
- “Any problems with the tenant the Lonnie dealer will receive an eviction notice.”
For our Turn-around MHP after many bad incidents with our Lonnie Dealer and Tenants (such as: Tenants not paying us…of course they paid the Lonnie Dealer) we ended up evicting both the Tenant and the Lonnie Dealer.
The Lonnie Dealer was incensed that we evicted him, along with the Tenant.
There are probably some good Lonnie Dealers out there.
However, our Business Plan does not include them.
We wish you the very best!
Thanks @kristin! What have you found to be your most cost effective method of bringing homes in? (Forgive me, if you’ve already answered that question earlier, lol!)
@DPW , as per your question:
- “What have you found to be your most cost effective method of bringing homes in?”
That is a great question and I am probably not the best person to answer that question as we are still trying out strategies 
.
I like the “idea” of the strategy of purchasing new singlewides using the “Cash Program” or something similar. However, we have not tried this yet as we need to be a MH Dealer.
I also like the “idea” of advertising Mobile Home Lots. We have not tried this yet for our Turn-Around MHP, because it is still turning.
We have had multiple people contact us about moving their MHs into our Turn-Around MHP.
However, there is a reason that a lot of these people contact us (like they are being forced out of their current MHP). We have listened to their stories, investigated and approved only 2 of them into the MHP.
We have done the following:
- MHP - Turn-Around: Lonnie Dealer - 2 Mobile Homes - Did Not Work Well
- MHP - Turn-Around: Purchased Used Mobile Homes - Off Craigslist - From Owners Outside MHP - Who Lived In Them On Their Acreage While They Built Their Stick Built Homes - Purchased 3 MHs - Worked Out Fairly Well
- MHP - Turn-Around: Purchased Used Mobile Home - From: Mortgage Company Outside MHP - Repossessed - Purchased Cheaply - But Needed Lots Of Work - Worked Out Fairly Well
- MHP - Turn-Around: Mobile Home Owners Selected To Pay To Move Their Mobile Homes To Our MHP - This Is Unsolicited - We Did Not Pay For Any Moving Nor Setup
- MHP - Stable: Purchased Used Mobile Home - From: Tenants Of MHP - Did Not Want MH To Leave MHP - MH Stayed In MHP
We wish you the very best!
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My market is entirely different than in the US so not relevant for you.
We buy new homes from Fairmont, there is a dealer for them up here, and pay about $75,000, set and sell for about $90,000. Our buyers either pay cash or get bank financing.
Unfortunately the low Canadian dollar is killing our market and although we still need 3 more we will have to wait for closer to parity to afford to fill those lots.
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I have signed up with Greentree and Vanderbilt. They send lists at least monthly of repo homes you can bid on, and then rehab.
In my SC park, I was lucky to have 7 homes move in, in 1 & 1/2 years by offering move in incentive, advertise on craigslist, offer money to residents if they recommend someone who moves in.
The problem with Lonnie Dealers as I see is if they get too ambitious and start moving in lots of homes they basically get the upper hand and start asking for discount lot rent or I have been asked, to only pay when it is occupied. Not living near the park you never know. Its like having RV’s come and go. How do you really know or not.
Yes you can go to court and get them out but its a hassle and you could lose those homes.
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Great answers guys! I would absolutely put a cap on how many homes a Lonnie dealer could bring in to avoid the “upper hand” issue. I think to help mitigate my risk, I would need to have one Lonnie dealer per so many homes and of course screen them accordingly.
Try a faxed ad to all of the local dealers, movers, chamber, post in supermarkets, laundry, bars etc
that you help pay cost and then bonus if someone recommends them,
Its cheaper than bringing in your own homes and no rental problems.
It involves some leg work going around and not guaranteed to have results.
When I am feeling ambitious I will go around the town and hand out fliers and talk to people.
As soon as they hear the money part for them they get interested.
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DPW
How did you ever make out with the Lonnie Dealers?
I am new to Frank & Dave’s world. Going to my first boot camp in February, so at this point I dont know anything about buying MHP’s or the lingo used in this sector of real estate investing.
I was looking to find out the definition of Lonnie dealer and based on the definitions I came across, realize that is how I got started. As stated I dont know anything yet, so I may be reading the definition incorrectly.
However, my very first deal in real estate was helping an elderly woman stop from being foreclosed on. I purchased the home, put $11,000 into the home and resold it carrying the note for a 60 year old couple who had never owned a home before. They were most excited about their grandchildren coming to the “OWN” home.
The elderly woman I originally helped is now in senior housing and never again has to worry about foreclosure.
I went on to do 7 more deals on mobile homes, this same way. Helping a single mom of 4 go from paying $1200 a month rent to paying us $475, she paid off within 2 years. She know lives for $73 a month HOA fee in the park, while owning her own land.
Another, a grandmother who lost her daughter and was left to raise 15 & 17 year old boys. She now has a place big enough for all, and a place she can maintain and afford.
If I am reading what the definition of a Lonnie Dealer is correctly, than I have to disagree that we are all after just putting “warm bodies” in the homes vs being on the same psychological, social and community driven goal as the park owners.
I currently specialize in Rent To Owns on mobile homes and SFH in CA, OH & NH. And would do so throughout the country if I had good colleagues on the ground, in other areas.
I would do this type of investing “Lonnie Deals” all day long, every day if I had park owners that would drop all the hoops of not letting people “Rent” vs having to own the mobile homes themselves in their parks and allow me too be the bank and part of their community.
If anyone and I ever have the same philosophy on helping and influencing people, then I look forward to being a part of this forum/community to connect so we can help more people get into homes they otherwise wouldnt be able to afford.
I look forward to hearing your story of how you filled your parks…