Need info on MHP leasing

I am in need of help working out a lease for 6 months +/- as my down payment will not be liquid for about 3-4 months. Seller is in bad health & needs to get out of the day-to-day operations and is open to the idea. My thoughts were to let him keep insurance etc. in place & we could split (by agreed upon %) monthly “profit” based on his own records of past 3-4 years or actual (my preference but would create a delay due to calculating).Your thoughts, please!  Thanks

loaded topic,I would lease / optionI would use a ‘seller default’ in the option with death being a default.maybe the seller would convert the lease to a note upon his death, and the note is held in trust for the benefit of his heirs? I actually offer this as an exit strategy to sellers, as it solves lots of estate planning crud. They get income from the lease for the rest of their lives, then the heirs get income for 20 - 30 years after that. The property ‘steps up’ in value upon death, thus taking out the capital gains tax. Use a performance deed of trust. Pick a today price, and adjust it upon death using a ‘cost of gods index’ that adjusts the price according to a housing marker. 2 bedroom rentals in the closest rental market indexed, Adjust the ‘lease’ payments every 48 months based on the same index. I have invested hundreds of hours into this concept and thousands on attorney fees for the documents. For many people, this is by far the best option for everyone. your downside- no deprecation writeoff. So you MUST adjust your return. You can see the adjustment in an APOD. Make sure you covered with he insurance. Make all the heirs sign the agreement, or they have at least seen it. Figure out what the loan payment would be and that is a good place to start for the lease amount. good luck- I love these deals… 

Thanks, For the advice, Jim.
I am only needing a few months. The seller is carrying paper for 1/2 so no bank involved. I just need a way to simply take over for a few months while we wait for my money to become available. I am not interested in a long term lease at this time.
Thanks again, Jim

Other ideas?

NNN lease would give you control. I did this when I was buying one of my parks. I told the guy the only way I would keep my offer in the ring is if he let me lease the park right away. He had a management company hired and they really, really sucked. They would move in anyone with a heartbeat… 

Ok. I get it. But did u lease at a set $ amount? Did u then take over insurance, etc? I am still foggy on the details.
Ty. I appreciate your help.

yes. I set a hard number I was paying him, and I covered everything else. Triple net NNN. So I paid all the bills, covered all the costs.

Now I am with you! Failed to catch the “NNN” before. I think that’s what we call +++ around here.

So I would pay him the set amount at first of month then do collecting n bill paying, etc?! Would you set an amount to limit your liability in case of a huge expense?

I guess you could. Capital Improvements to infrastructure maybe. You need to be very careful here though. I would spell this part out very carefully. With my lease / option I did not worry about this, as I knew I was buying the park so I covered everything. If your spending his money, he needs to do the repairs or he at the very least needs to approve you doing them. I would agree on that price of the repairs and time frame early on. Some things you can not wait on, collapsed sewer, failed water, some electric issues. Life safety issues. You will need to spell out how these are managed, and if not within x hours, then what?

You have been very helpful and I am grateful. At least now I feel like its doable. Is there any resource for a sample lease I could look at or should I just get my lawyer to write it up?

I have no intentions of writing it myself, of course. It would b for filling in a few details in my mind before I give it to my lawyer. My paranoia takes over when I lack understanding/knowledge. It’s the college professor in me!! ;))

I think this is a problem for a very good attorney. You need to make sure all of your bases are covered in the state your looking to operate in. I do not have a document that would begin to cover all of the issues, primarily because my stuff has the ‘option’ that was written in to cover issues that might arise with the seller. In the type of lease your looking at, both you and the owner will need to be held accountable for things, and if either of you defaults… well you will have to figure out how to manage the damages. A pilot friend of mine says there are only two kinds of pilots, those that have ‘had’ wheel up landings, and those that ‘will have’ wheel up landings. So- fly like your going to have to land ‘wheels up’. In this case, probably nothing will go wrong, but if it does, you are going to need lots of wording that designates ‘who does what when’ because your both passengers in that plane. You can roll the dice with a generic NNN lease- or you can pay an attorney a couple grand to write the lease. I would… have the seller sell the park on 12 months of owner financing, you get your loan into place and refi the owner out of his carry. Take 6-9 months to get the financing in place… if the loan goes over a year- default rate a few point over what your paying. Not so you loose the park, but so it hurts. Your motivated to refi, he is liking the income… 

Ok. Ty for your sound advice.