Creative Financing Ideas

After attending the recent boot-camp in Columbus, Ohio, I’ve been trying to find a park to purchase.

Just testing waters locally, I have found a good deal near me on a MHP (10 minutes from my house). It was not advertised.

My only problem now is getting the down payment together. I am thinking of ways to go about this because the people selling the MHP are older (80’s) and do not want to deal with it anymore. This MHP seems to be their main source of income for retirement and they are very concerned about the down payment. They are open to options. But, there is also an existing mortgage on the park.

I’m thinking private investor (partner with someone), forming a partnership with them and slowly buying them out of their share, paying their existing mortgage with a spread and additional payments to them…

Anyone have some creative ways/ideas to get this done?

Thanks in advance!

JP Hooie

If they “don’t want to deal with it anymore” then maybe your best option would be a Master Lease with Option to Purchase. Basically, forge a monthly lease rate that allows you to easily cover them, and set a purchase price that’s sensible. Then take over the operation of the park and turn it around and get it running on all 8 cylinders and then buy it based on these better numbers or flip it. If you have a three year lease. for example, that would give you one year to fix it, one year to season it, and one year to sell or find financing for it.

I was flipping through the presentation book given out at the boot camp (where I wrote my notes) about 15 minutes ago and came across this very concept. What should I offer them? Their asking price is just over a million and by basic calculations, it should be worth 1.4 at least. What are normal terms for this? How much down? Should I offer more than their asking price (as a down payment at the end of the lease) perhaps?

Thanks again,

JP Hooie


Since these sellers are seniors they will most likely have issues with an unconventional structure like a Master Lease. I’ve only had success getting a Master Lease signed up with a more savvy investor. However, the more you talk with these folks and get to know them, the better chance you have of working out a deal.

I would suggest you get a good handle on the numbers and see what things look like currently. It’s very possible that these mom and pop owners have no documented financials on the property like a P&L or current rent roll. If that’s the case, then you could approach them with the idea of seller financing / Master Lease because a bank would not make you a loan.

Keep things simple with this kind of seller.


Thanks for the response!

They have an existing loan that is possibly assumable. I have no experience with assuming a loan so, I don’t know what this would entail. Our relationship has been friendly so far. They were more concerned at first that I was from another park or a broker trying to comp them. Once I told them about myself, they were open to hearing my ideas on financing and even mentioned that they could have something drawn up by their attorney if needed. I have asked them to provide their general financials and information of the park as the next best step.

JP Hooie

JP, sounds like you have your foot in the door. If you want, post the numbers on the deal when you have them and I’m sure people on this forum will give some great feedback. Good luck!