We are looking to buy a $300k to $400 first MHP with about $100k down, looking for seller financing. The broker on one deal we were looking at told us that since we were new, NO SELLER would finance for us, that we need 100% cash. It seems to me that if we gave a seller $100k then had to walk away and give the park back to the seller in a year or so, the seller would be the one coming out ahead. BTW, we aren’t total newbies. We have owned apartment buildings and hotels and were active managers. Not quite the same, but a lot of similarities. Any thoughts?
My personal opinion would be that the broker you are dealing with on that deal, has tunnel vision and can only see his commission. The seller would not know whether or not you had prior experience unless they ask you or ask you to provide any type of references. If you feel good about the deal and the numbers and everything else makes sense, then make the offer. If it is a reasonable offer, the broker has to present it to the seller. You can always try and contact the seller directly and speak with them because it sounds like their broker may be turning down good offers.Just my thoughts, others may feel differentlyDanielle
I would submit a real estate resume with your offer that lists your prior experience. When I was selling my REO deals (and we couldn’t provide financing under any circumstances), I wanted to deal with experienced buyers of real estate so that was always a required element of the bid sheets. Certainly ownership of apartments or hotels would demonstrate an acceptable level of experience.Rather than suggest the broker is commission focused (they get paid regardless of the financing structure), I suspect they are wary of inexperienced MH investors. On a $400,000 deal, there are only so many rabbit holes a broker will go down. While the broker is required to present all offers, they work for the seller. Your lack of MH experience is a material fact that would be disclosed by the broker. Furthermore, you’re seeking a loan from the seller for 75% LTV – they ought to ask about experience as part of their diligence.That said, your willingness to put 25% down and experience with other types of challenging real estate are certainly encouraging. Good luck!Will