What To Do After Purchasing A Manufactured Home In A Park
Let's imagine that as a successful mobile home investor you have just successfully purchased another mobile home inside a local mobile home park.
Your newest mobile home investment acquisition is an average 1990's model and has 2 bedrooms and 2 full bathroom; the type of mobile home you have walked through hundreds of times before. The seller is happy to be free of this home and both of you walked away from closing with smiles on both your faces. The home is in used condition both inside and out. You know you've made a great deal.
Your next major goal is to sell, rent, or fill this home with a low-risk resident to begin creating cash flow from monthly payments or an all-cash profit from a quick all-cash sale. What else may you want to do?
Below is a short list of after closing steps to consider completing after every mobile home you purchase inside a park for investment.
Step 1. Take Control
After closing it is now time to transfer ownership from the seller to you, your company, trust, or another legal entity. Be aware that in every state there is a maximum number of days before a penalty is charged if you do not transfer ownership of this home. In most states this ownership is conveyed through a Manufactured Home Title and there is a deadline between 7-30 days to transfer ownership. In reality this “transfer” should be done immediately after closing to avoid transfer issues should you wait.
This grace period gives you at least a week's time to make a trip to your local DMV, DOT, or state MH division to transfer ownership and receive a new Title. Some states require all Title(s), taxes, state forms, and sales documentation mailed in versus you being able to transfer ownership in person. A week is still long enough to mail all forms in as needed.
Pro Tip: The transfer process to exchange ownership from one person to another varies from state to state. For any specific questions please comment below or contact your state's mobile home titling department to ask any specific questions to gain more clarity. Make sure your questions are answered prior to purchasing a mobile home, and not after.
If you are purchasing your mobile home directly from the community or a local dealer, this entire transfer process will likely be handled by the community/dealer.
Step 2. Appreciate
Who helped you directly find this home? Was this a referral from another investor, dealer, Realtor, park manager, or acquaintance? If the source of the lead is anything else besides “only me” then you owe someone a sincere thank you. This thank you can be in the form of a gift, gift-card, or cash if legal in your area. Most states do have a limit for how much you may pay a non-Realtor for leading you to a buyer or seller.
When offering to give a “thank you gift” for successful leads aim to ask the person what he or she feels is a fair compensation they are happy with first. Often times the amount suggested is lower than the fee you had been thinking in your mind. Either way make certain these unofficial bird-dogs are happy with the compensation.
Pro Tip: This business is a journey. Make sure to celebrate this purchase-success by taking your loved ones out for a memorable time.
Step 3. Clean & Repair
Curb appeal goes a long way at making your neighbors, park management, and park owners pleased with the decision to allow you to invest in mobile homes within their community. In addition to the instant park image-improvement by cleaning up your mobile home, your future tenants/buyers are highly likely going to approve of this added club appeal.
Pro Tip: Always have a thorough understanding of needed-repairs to be completed and why. These needed-repairs may change depending on your desired exit strategy, area, time of year, and more.
If a potential buyer says, “Wow” (in a happy-way) then a sale is more likely to happen versus leaving the home in a dirty condition. Here are some quick clean ups to consider making right after purchasing most mobile homes inside parks.
- Skirting: A quick fix to add curb appeal to a mobile home with messy skirting is to clean and straighten these skirting panels yourself. If panels are damaged or missing from the front then simply rotate pieces from the back to clean up the front. This will help add to the home's curb appeal from the road. Small holes are common and expected.
- Exterior washing: If you hire this task out you will likely pay $75-$200 depending on the size of the mobile home and possible extra charge for cleaning the roof. While pressure washing a mobile home will clean deep down algae and dirt, some mobile homes may only need a spot cleaning or nothing at all. Be aware that pressure washing a mobile home with wood or faux wood siding may easily strip off paint or cause damage.
- Roof maintenance: An elastomeric type of roof coating is an inexpensive treatment that can really make a big difference in preventative maintenance and esthetics. This roof coating can be applied with a paint roller within a half a day. A clean white coating makes things look uniform, keeps the home cooler in the summer months, and can help plug up any pinhole-sized tears or holes in the roof. Do not use this product with shingled roofs.
Step 4. Advertise
Continue advertising and sending potential and prequalified buyers/tenants through your investment home until you have money in your hand from a buyer. A potential applicant that wants the home still needs to become park approved with the front office. This can typically take 1-3 days for the applicant to be approved or denied. While marketing the home you will be paying holding costs and miscellaneous expenses. For this reason make sure to advertise and market the home for sale or rent in as many channels as possible. You want everyone within a 15 mile radius to know you have a mobile home for sale or rent at an amazing price.
Pro Tip: Advertise in as many online and offline mediums as you can think of. Make sure to track which advertising methods work and don't work for brining in leads. Prune away what isn't working and increase what is working.
What this article is missing? This article only touches on some of the should-do's or must-do's after purchasing a mobile home in a park. Depending on your exit strategy and local market the list above will likely expand to more topics. If you have any questions or comments please do not hesitate to comment them below for us all to learn.
Love what you do daily,