- Mobile Home Move
- 37 Manufactured and Mobile Home Communities near Leesburg, FL
- Lonnie Scruggs
- Mobile Home Makeover and Flip, Without The Makeover
- WHY LONNIE SCRUGGS’ MOBILE HOME PARK DEALS DON’T WORK FOR ME
- Lonnie deals $2,700 – Mobile home
- Lonnie Deal – Mobile home buy/rent
- Why isn’t everyone buying and renting mobile homes($2k-$6k)? what am I missing?
- Mobile Home Investing
here is a strategy that can work. It’s nicknamed a “Lonnie Deal” after an investor named Lonnie Scruggs who developed/refined and popularized the idea. (I’m sure you can look his stuff up online; he’s got a couple of self-published books on the strategy.) Basically, it involves an investor buying a mobile home cheap for cash. Then the investor does whatever rehab is needed, then sells it on terms to someone else. Here’s a real quick example: You find a mobile home that you can acquire, all cash, for $6,000. You put $2,000 into fixing it up. You find someone who wants to buy it. Your terms: $2,000 down and $180 a month for 7 years.
The buyer pays the lot rent.
Sound reasonable? You, the investor, are into it for $6,000. (You put $2,000 into rehab, but got that back as the downpayment. $180 a month for 7 years repays an $8,000 loan at 20,49%. So the price you’ve charged the buyer is $10,000, $2,000 down, 20.49% interest. (Watch out for any state usury laws.)
But it gets better (for you). Remember: You’re only into the deal for $6,000. But you’re getting a return on an $8,000 mortgage. What’s your return? You’re getting $180 a month for 7 years on a $6,000 investment. That’s a 32% return on your $6,000.
What makes the deal work? Lots of folks selling mobile homes will take a deep discount for cash. And lots of buyers can’t afford all cash. They’re looking for affordable terms. The “sweet spot” is being in the middle. Buy low with cash; sell for more on terms.
And what makes it so attractive for investors? It’s not just that you’re getting a good return on the sales price, but that your investment (thus, ROI) is less than that sales price.
That’s how you make money by purchasing a mobile home.