Welcome back,
In today’s Mobile Home Investing Podcast episode #18, we’re talking about brokering and wholesaling mobile homes and how this applies to you and your local business. Each mobile home “purchasing-technique” you possess is a valuable tool that can be used to provide options to help sellers and create value. The more “purchase techniques” you clearly understand with regards to mobile home investing the quicker your business may grow.
I’m very excited to bring Dan to the podcast co-hosting microphone. Dan has been investing in the Colorado mobile home market for the last 2 years and is loving it. He is now a full-time mobile home investor and broker. Dan is not a Harvard graduate, he’s not a genius, he doesn’t have more hours in the day than anyone else. However, Dan consistently closes deals, helps sellers, and dedicates specific daily effort to propel his business further each day. Since meeting Dan, he has been dedicated and self-driven to achieve more and continue to help others nearby. A special thanks to Dan for coming on the microphone and opening up his cash-flow business and strategies on this content packed 46-minute podcast.
Disclaimer: The Colorado real estate market is exploding right now. Dan has found a need/demand and is filling it. Brokering and wholesaling, in addition to investing, works well for Dan due to the hot Colorado market, ample supply of cash-rich buyers, advertising/marketing skills, and Dan’s love for the business and helping others.
Definitions: Brokering homes is the act of being a dealer or broker and helping to facilitate a sale between seller and buyer. In short, you are acting as a “personal property real estate agent”. Wholesaling mobile homes is the legal strategy to make profit from a mobile home Purchase and Sale Contract. Both methods require skill and a thorough knowledge of your paperwork. Brokering mobile homes may require a dealer or broker license in many states. If you have any questions, please comment below.
Game: Can you correctly guess any price each mobile home sold for all-cash? (Key below) A, B, C…. H
Wholesaling mobile homes in parks is not something I fully appreciated until years into my career. There is a time and a place for wholesaling and/or brokering deals. A quick test to know if you may be able to wholesale a home quickly within a specific park is to ask the park manager, “How many comparable homes have sold for cash in this same park in the last 6 months?” If the answer is more than 3 then you may have a decent candidate for a quick cash sale, or perhaps bank financed sale if the home is new enough and with a proper foundation.
Have you ever wholesaled a mobile home in a park? Have you ever wholesaled a mobile home on private land? Obvious things to consider prior to signing any Purchase and Sale Agreement are the realistic buyer-demands locally, time of the year, is the home bank financeable, repairs needed, year of home, seller’s motivation, foundation, lot rent, cash buyers in the market, etc. Please don’t hesitate to ask questions or comment below.
Mobile Home Brokering & Wholesaling
| PRO: Little to $0 money invested.
PRO: Quick cash profit ($500+) PRO: Marketing skills required. PRO: Small time investment. PRO: Create a value instead of passing on the lead. PRO: Able to help a local seller. PRO: Good word-of-mouth advertising and branding. | CON: Difficult in slow markets or non “hot-spot” type markets.
CON: Cash buyers are few-and-far-between in many markets. CON: Don’t keep the home for tax depreciation purposes. CON: License needed to broker mobile homes in most states. CON: In some states a “Net” listing is not legal even as a broker or Realtor Con: Con: Con: |
In this Mobile Home Formula episode John and Dan cover:
✔ 1:10 Please tell us about yourself and about your investing business.
✔ 2:20 What does the Colorado marketplace look like? What are mobile homes selling for there?
✔ 4:00 What are the prices of some of your listed homes and sold homes?
✔ 5:45 How are you attracting leads when investing?
✔ 6:05 What are your typical buying prices for mobile homes inside parks?
✔ 8:20 When do you know to broker a home VS invest in the home?
✔ 10:21 Does one deal lead to another? How has this affected business?
✔ 11:44 How do you get paid from each brokering deal? Do you negotiate this?
✔ 14:23 Can you describe a deal you are currently working?
✔ 17:58 Do sellers ever get mad at the profit you make?
✔ 20:30 Getting video testimonials for your business.
✔ 21:44 Do you ever make repairs in any of the homes you are brokering?
✔ 24:28 How did you find out the brokering requirements in your state?
✔ 27:24 Brokering requirements vary from state to state.
✔ 30:24 Is brokering realistic in all areas?
✔ 32:12 Describe the deal where you only made $500.
✔ 35:16 Any time that backfired on you?
Books mentioned in the episode:
✔ Think and Grow Rich – Napoleon Hill
✔ Rich Dad, Poor Dad – Robert Kiyosaki
✔ Cash Flow Quadrant – Robert Kiyosaki
✔ How To Win Friends and Influence People – Dale Carnegie
✔ The Alchemist – Paulo Coelho
Picture Key: All mobile homes are located in parks and were brokered for a “Net listing” profit. Net listings are explained on today’s podcast. Sold prices are for all cash: A. $110,000 B. $22,000 C. $37,000 D. $27,000 E. $20,000 F. $50,000 G. $59,000 H. $44,000.
If you are looking at these prices and saying, “I could never seller a mobile home for those prices in my area.” You may likely be correct if requiring an all-cash buyer. In many areas of the country there are more sellers than there are cash-buyers, this means less selling of mobile homes for cash and bank financing, and more selling for payments when possible. Either way, value is created, and sellers/buyers are helped.
Related article: Mobile Home Investing: Over 430% Cash on Cash Return
Related Video: Fast-forward to 2:18 into the video to start the Wholesaling Lesson
Listen to Dan’s Podcast Here
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17 Comments
Carol Rodriguez
April 29, 2016I always like your articles John. I was wondering when another podcast was coming out. This one certainly beats my expectations. I had a little trouble hearing you but I was able to understand everything. I will absolutely be adding this strategy to my toolbelt. I am near Raleigh, NC, do you know if I will be able to wholesale or broker homes easily in my area. Please and thank you for any help.
Carol
John Fedro
April 29, 2016Hi Carol,
Thank you so much for commenting and for your kind words. The podcasts are a labor of love and I will certainly keep them coming. 🙂 Absolutely make sure to add this purchasing strategy to your toolbelt. The goal is to help provide value to sellers, and this is certainly a viable way to do so. In your area there are a greater number of cash buyers per capita than in other areas of the country. Your area is certainly not a Los Angeles or a Colorado, however there are cash buyers willing to pay cash for an attractive mobile home. With that said, there are still many more payment buyers in your area than there are cash buyers. Most of the sellers around you will be looking for all-cash type of buyers as well. Again, make sure to ask any park manager you plan on wholesaling a property within, “how many comparable homes have sold for all-cash within the last six months in this park?” I hope this helps and make sense. If/when you have any follow-up questions or concerns please never hesitate to reach out any time.
Talk soon,
John
Larry Weingarten
April 30, 2016John, thanks for the nice, detailed video! I have a question regarding selling for payments. My understanding, from what you’ve told us before is that one may sell a mobile for essentially what a nearby apartment with the same number of bedrooms would rent for. My question is about how to keep the park management happy while not getting tripped up by Dodd-Frank. I understand that title needs to be transferred and a lien put on the home at the time of sale. I think sellers used to transfer title only once all payments had been made. What I don’t want to have happen is to sell a mobile and have the buyer miss payments to the park, forcing the park to take action, like seizing the (my) mobile. How do you deal with the risk of your buyer not keeping up with payments to the park, while staying on the good side of the law? Thanks for any help!
Yours, Larry
John Fedro
April 30, 2016Hi Larry,
Thank you for commenting and reaching out. Please see my thoughts below in bold.
John, thanks for the nice, detailed video! Of course. Very happy to help. I have a question regarding selling for payments. My understanding, from what you’ve told us before is that one may sell a mobile for essentially what a nearby apartment with the same number of bedrooms would rent for. In most areas this is correct. My question is about how to keep the park management happy while not getting tripped up by Dodd-Frank. I understand that title needs to be transferred and a lien put on the home at the time of sale. I think sellers used to transfer title only once all payments had been made. What I don’t want to have happen is to sell a mobile and have the buyer miss payments to the park, forcing the park to take action, like seizing the (my) mobile. How do you deal with the risk of your buyer not keeping up with payments to the park, while staying on the good side of the law? Great questions. There are a few different relationships to consider. Your relationship with the federal government. Your relationship with the state. Your relationship with the park. Your relationship with the tenant-buyer. And potentially your relationship with the seller, if you are making them payments for the property. You always want to make sure your paperwork is correct in legal with regards to the federal government and the state’s closing procedure. It is true that you should sell the ownership interest if the home in most mobile home communities. This is because they will not allow renting or lease-option within their park in most cases. In the past investors could sell a mobile home and simply attach a lien/mortgage/deed of trust on the property completely legal without many seller financing restrictions to speak of. This is why mentioned above to have your paperwork correct in legal, we want to make sure we are not in violation of the new seller financing restrictions and acts. With all this said I do encourage you to accept the full payments from your tenant-buyer monthly. This means you will be collecting the lot rent payment and the payment for the home in one easy payment from your tenant-buyer. For the first two years I encourage you to accept this payment and pay the lot rent directly. This way you know the lot rent is being paid every month, plus this gives you a reason to call the park manager and find out if there is any other properties the park has for sale or will be getting soon. I hope all this make sense and answers your question. In short, you do want all your paperwork to be correct and legal. Many mobile home parks will not be worried about you selling the home for payments and violating these laws… That does not mean you should ignore these laws because you absolutely should not. With that said, stay compliant with national and state laws, let the park manager know exactly what you are doing and pay them monthly, and sell homes on attractive terms and prices. I hope this all helps and make sense. If I did not fully answer your question or you have any follow-up questions please never hesitate to reach out any time. Keep in touch.
Talk soon,
John
Gilbert
April 30, 2016John: does your system work in California? I stopped into 5 parks last year and they told me that they would only deal with an owner who wants to move into the park. They would not allow rentals.
John Fedro
May 2, 2016Hi Gilbert,
Thanks for reaching out and commenting. Yes, I’m currently working with a few folks in California that are having success. Most parks around the United States will not allow “renting, subleasing, subletting, or leased to owns” within their walls. It is for this reason we purchase everything and resell everything day #1. Additionally, approaching the park manager is a very important first introduction. You want to make sure you say the right things and know that you are there to make the park managers life easier while trying to increase park revenue. With you are a member of this training and mentoring program or not I’m happy to answer any questions you might have. I hope this all helps and make sense. If you have any follow-up questions or concerns please never hesitate to reach out to me anytime. Keep in touch.
Talk soon,
John
Gilbert fleming
May 3, 2016Thanks foe your message.
I live I Freno, CA. Do you have any incite or experince in Central CA? My wife and I are considering relocating
To Orlando FL (for family reasons, Is Fl a better marker?
John, there is SO much info on your website. Which is fantastic.
Can you recommend the type 3 or 4 tubes that I can watch to get the “vibe” of your investment methods?
Gilbert
John Fedro
May 3, 2016Hi Gilbert,
At the moment I am not working with anyone in the Fresno area. I do have experience in the northern and southern areas of your state however less in the central areas. With that said I did a quick search and found more than 150 mobile home parks within a 50 mile radius of you. This is a very good supply of homes and parks. Please keep in mind that some of those are overpriced and others are senior citizen communities that you may want to stay away from for your first few deals. With that said there are likely sellers around you that are confused as to why their homes are not selling quicker. These seller may be able to use your help or guidance.
The Florida and California markets are quite different and similiar in some wways. Depending where you moved to in Florida it can be very similar to California, both in good and bad ways. The coastal areas of Florida are similar to some coastal areas in California, and the inland parts of the state are the same in each state. Closing procedures and rules change, however there are still buyers and sellers needing help in both states. Florida does have a greater supply of mobile home parks in most areas, plus it has mobile home parks attached to private land in greater supply than California. This is strictly from experience in helping folks in both states. I hope this helps and makes some sense.
Thank you for the kind words. I hope the site has been helpful to you thus far. I’m not confident I understand your last question about recommending the “type 3 or 4 tubes that you can watch”. If you want to rephrase this a different way or ask me again never hesitate. Keep in touch.
Talk soon,
John
Dan
May 12, 2016John,
I had a lot of fun being on your podcast. Thanks so much for giving us the opportunity to talk about our Colorado manufactured home dealer business with your audience.
I hope this podcast helps others around the U.S. No matter what market they’re in, having the ability to broker manufactured homes is a great option to present mobile home sellers. Especially for newer, pricier homes or older, well-maintained homes that may not offer great opportunities to flip or invest for cashflow.
Whether we’re brokering manufactured homes or investing in mobile homes, without your help we wouldn’t be having the success that we’ve had. We love to sell mobile homes in Colorado for our clients! Thanks again!
– Dan
John Fedro
May 16, 2016Hi Dan,
Thanks so much for the kind words and helping out. You have done so much and help so many people in such a short period of time. Keep up the great work making yourself well-known in the area and following up with local sellers, parks, and buyers. I totally agree that wholesaling and brokering manufactured homes is a good tool for all mobile home investors to be aware of. The more applicable information we have and strategies we know how to use to help sellers and buyers the better. Keep up the great work and keep in touch.
Talk soon,
John
Jim Philips
May 16, 2016Blown away. 28.6k in 1 week. I am in the wrong line of business. But I agree with you John that the California market is quite different than what you may find in southern states; especially with pricing. Nonetheless the model you are using is very smart! Keep it up!
John Fedro
May 16, 2016Hi Jim,
Thanks for commenting and reaching out. If you have any future questions or concerns please never hesitate to reach out any time. All the best.
Talk soon,
John
Vin Rameriez
June 2, 2016Hi John Great post…..I had never known this Idea before. I like it for sure. Thanks for Sharing and Thank you very much for the information i really appreciate it. keep it up. – Vinny
John Fedro
June 2, 2016Hi Vinny,
Thank you so much for commenting and reaching out. Additionally, thank you so much for your kind words. Moving forward if you have any follow-up questions or concerns please never hesitate to reach out any time.
Talk soon,
John
Real Estate Montenegro
August 7, 2016Great article and interesting strategy. There is so much to learn from this post.
John Fedro
August 10, 2016Hi Real Estate Montenergo,
Very happy to help. Thank you so much for commenting and your kind words. Moving forward if you ever have any follow-up questions or concerns please never hesitate to reach out any time. Always here to help.
Talk soon,
John
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