Reasonable Amount down and Carry Terms

We are in the process of selling our park, and there are a couple of numbers I wanted an opinion on.

How much are people being offered as money down on their sale? I thought 20% down was typical in all markets. We’ve had a few offers where people wanted to put down as little as 1.5%

It sound like people are having trouble getting banks to loan these days, so in order to accomodate “the right person” we’re open to seller financing, and along those lines have been told by a banking buddy that 6.5% over 10 years is a reasonable set of terms for this economy.

Looking forward to your thoughts,


Hi John,

You will probably get widely differing responses; this is just my opinion.

a) What is the quality of this park? If this a really rough park that cannot get financing and needs lots of turnaround then you will need to provide better terms than if you had a nice, smoothly running park

b) How desperate are you to sell. You dont need to answer this but if you are not in a hurry then there is no need to let buyers dictate

c) SKIN In the GAME: Seller financing is HUGE to most people and you need to be aware of that. I would be VERY cautious to sell one of my properties via seller financing unless they showed real skin in the game. 1.5% - that is a JOKE! These buyers have no skin in the game and have no incentive to properly run the park. Personally I want someone to put at least 30% down of their money - not borrowed.

Additionally, they better have a good track record operating parks — aside from a few folks in this community I would not trust someone to buy my park if I had to carry the paper. What if they totally screw it up and walk away?

d) 10 years is a long time - you usually only see that with conduit or large loans. I would set a balloon in 3 yrs so they have incentive to improve the property and try to get bank financing later.

I recommend you talk to some banks/brokers who do lend on parks. Ask them whether they think your park is financeable if you were to find an interested buyer. Ask them what kind of rates and terms they see for your park.

Bottom line is be careful. There are so many jokers and flakes out there who have watched too many Carlton Sheets infomercials.


If you seller-finance, consider cross-collateralization. You hold a lien against other properties the seller owns, in addition to the park you sold, and you get title insurance and appraisals on those properties. Even if they put down 30% like Howard suggests, get more security. The buyers may totally screw up and leave you a mess to deal with in a few years. However, if they know they could lose other properties in addition to the park, they have much more incentive to not screw up.


Wheat Hill