When doing a park refinancing, what % of each note typically gets rolled into the refinancing? In other words, what value does a commercial lender place on a note (par value, 85%, etc.)?
Is this value over and above the value of the underlying lot?
How would the math differ if the home were occupied by a renter on a Rent Credit program?
You need to attend the bootcamp. Just sayin’. If you’re asking this question then you have far too much to learn to even think about buying a park. Not a slam, just an honest attempt to keep you from making a huge mistake.
I own a few parks, and previously attended a boot camp in 2010.
I have opted to go outside the traditional Clayton CASH and Legacy programs to fill my vacant lots.
I instead used a margin loan secured by my portfolio of marketable securities for sub 2%. I am far ahead of the alternative options from a cost standpoint
My question is whether after I bring in 30 homes on this program, then do a refinancing of the park, does a bank value a home note, or is it considered valueless? If the former, what % of the face value is deemed typical?
It is extremely unlikely that the bank will want to get involved with your homes in any way. However, some banks might be crazy enough to do it. I would run that scenario past your bank and see what they say about it.
That question makes a lot more sense, but Charles answered. The way you originally worded it I was imagining a bunch of RTO notes on older homes.