Can This Deal Be Done - Re: RTO's

I have a park under contract that has 50+ vacant Park Owned Homes. I planned to sell them all asap via Rent to Own. The seller 1st agreed to give me the titles to the mobile homes, then said he would only do it if I carried windstorm insurance coverage through the 10 year term of the seller financing and agreed to pay him 1/2 of any insurance proceeds for losses during that time, as the park is located in a high wind area. I had planned on getting rid of the mobile homes in 2-3 years. I don’t want to disclose to the seller how I plan to turnaround the park, but I don’t know how to structure the deal to satisfy the seller. As I understand it, if I give the title to the mobile home buyers in 2-3 years, I would no longer have an insurable interest in the park. Any thoughts on how to structure this.

Also, this begs the question, how do you get a Seller to turnover the mobile home titles up front, without any conditions and not retaining a security interest in them.

All good points, and completely subject to negotiation. On the insurance issue, I’d call Kurt Kelley at Mobile Insurance Agency in Houston. On the homes, you probably need so establish a release price on the homes if they are part of the mortgage – otherwise you really can’t sell them, but only rent them. On the titles, you need to make sure that you have full ownership of the homes, but you may need the time during the rental contract to get the actual title from the state – that can take months.

Can this deal be done? Yes, but only if you negotiate it well.

Thanks much for your advice. I will contact Kurt. There is another twist in this deal that I am unsure how to handle. The park is located in an area where they only recently (within the last 20 years) required titles to mobile homes. Prior to that, mobile homes were transferred via a Bill of Sale. This seller bought many Park Owned Homes more than 20 years ago & acquired many more later, when tenants left them in the park as they vacated. The seller has no titles to any of the mobile homes and can only give me a Bill of Sale. And all of the mobile homes are old and small (1970’s 2/1 or 2/2). Based on your experience, will today’s mobile home buyers buy these older smaller mobile homes if I rehab them so they look nice, if I can only give them my Bill of Sale (assuming I somehow resolve the insurance issue).