How does one prepare to purchase a MHP?

Hi Everyone,

I attended the MHM IV in Orlando and found it very informative. I am new to this business and ask the forums guidance. I have purchased “Huge Profits in Mobile Homes & Mobile Home Parks” by Ernest Tew & Steve Case. I also have both of Lonnie Scruggs books. I just need further education. One question, should I get prequalified for a loan to know how much I can afford. This way I will not spend valuable time shopping in the wrong price range.


I would like to hear some comments from those who have done this as well. Even though I am in a park already, I did not have much to do with the financing of the park (fellow investors took care of that) and we didn’t use banks.

What I know so far is most banks who finance parks will finance at 80% to 90% Loan to Value (LTV). That means if a park is listed for $450,000, you would have to come up with $45,000 to $90,000 down. If you have partners, investors or your own cash, use that as a starting point to figuring out what you could afford.

If you can get the cash (relatives, investors, etc) then go out and search for a park that fits your needs (cost, location, situation, etc). Once you find one, make an offer, get it under contract and do your Due Diligence. If it looks right and the numbers work, start making applications for financing.

If anybody here has any better advice, please chime in.

Jim Pack


Its all in the nagotiations as to what structure you will use. Some deals are 90% commercial lender, 5% owner carry and 5% from the buyer. Others 50% commercial lender, 40% owner carry and 10% buyer. The standard is 75-80% commercial with 20-25% buyer down payment. Don’t count park owned homes rent in income, lot rent only. Hope this helps. There is lots of money on the street right now looking for good projects.