Social distancing and lockdowns have brought many industries to a halt. However, this obstacle hasn’t kept everyone down. Mobile home investing is one of the markets that could keep going despite restrictions and uncertainty.
In this week’s EZU interview, we focus on some of the pitfalls that can give investors cold feet and how to navigate them to continue making deals. To get the full scoop, take a look at the video. But if you’re in a rush, here is the short and sweet summary to get you by.
Why is the mobile home market uniquely suited to working remotely?
We’ve been actively selling and buying mobile homes remotely for years. So we were unintentionally ready for the COVID-19 environment.
With modern technology, we can learn enough about a home without setting foot in it. You can show or view the home remotely – without ever meeting the buyer or seller face-to-face.
For example, through a videoconferencing app like Facetime, Zoom, or Google Meet, a seller can take you on a home tour, offering you a chance to ask all your questions and look for any faults.
Mobile homes are unique in several respects. There are fewer moving parts and less complexity. You are only buying the home, not the land it’s on, as with stick-built homes. So there is less for you to be concerned about.
The physical structure itself is moveable. Therefore, you have the freedom to sell the home on-site or even move it right across the country.
The beauty of the business is that there are far more possibilities for both buyers and sellers.
Dealing with the DMV
One of the recent challenges investors have faced is, “What do you do if you want to buy or sell a home, but you can’t get the title as the DMV is closed?”
Lockdown has certainly presented mobile home investors with very specific challenges.
But the key to facing them is often to rely on tried and tested methods. In this case, it is particularly important to make sure you have a paper trail. You want to have proof of everything on hand when you can finalize the deal.
How can you partner with EZ Homes University in Texas?
Texas is a hotspot in terms of buying and selling mobile homes. But significantly, their bureaucracy is also one of the most challenging to navigate. On the bright side, this has become second nature to us at EZ Homes.
We have been fully licensed and operating in Texas for five to six years.
All you have to do is reach out and contact us through the EZU website. Here you can also sign up to become a partner.
Unique solutions that EZU offers to its partners
Just what is it that EZU offers its partners? The best way to explain is to talk about one of our recent partners. John is a schoolteacher who joined our partnership program two months ago.
The first mobile home he bought was one of our leads. We mentored him on how to inspect, buy, and eventually close the deal.
Now he can go pick up a check for $10,000 to invest in his family’s future.
EZ Homes University offers a similar experience countrywide. We help guide our partners through buying and selling homes. In the end, they face fewer risks and receive more rewards.
Why do you prefer not to invest in mobile homes through notes?
We cut our teeth in the business buying notes, as so many people in the industry do. However, the returns on this system didn’t outweigh the headaches for us.
The S.A.F.E Act placed many restrictions on requirements for someone to act as a residential mortgage loan originator (MLO). After this was implemented, you needed to work through a registered MLO that charged quite a fee.
On top of this, working with notes increases your risk of default as you continuously have to chase after buyers to get their dues.
Overall, we believe cash now is better than cash later.
Have you had any problems with undisclosed liens?
Even we have had issues with this, but only on a handful of occasions among thousands of sales. Luckily, it’s generally very straightforward to perform a title search for a mobile home through the state, county, or DMV.
This title will reveal whether there are any liens on the home. So ask for a photo of this document before you even go look at the home.
If there are any liens, you have to have the relevant party sign off on a lien release agreement.
The role of lot rent
Lot rent is one of those potential issues that you always need to investigate. What is the lot rent in the park? And has all the rent been paid?
You don’t want to buy a home and get burdened with someone else’s unpaid bills.
There are a few ways you can deal with that.
First, if you are unsure, you can contact the park to investigate further.
Secondly, never pay the full price upfront. We typically make a 50% down payment before we do the final walkthrough. Our contract states that if the seller doesn’t disclose unpaid fees, the other 50% will go to pay those off.
Make it a point to always check the lease agreement.
Learning by example
There are some mistakes you only make once. But by learning from our example, you could perhaps avoid them completely. At EZ Homes University, we use our wealth of experience to answer your questions and coach you through your mobile home investment journey.
02:45 The mobile home market and remote work
06:08 Geographic possibilities
09:30 Dealing with the DMV
11:39 Partnering with EZU
20:15 The cons of notes
14:20 Unique solutions that EZU offers to its partners
24:00 Undisclosed liens or judgments
26:40 Lot rent