It was totally by accident!
But boy am I glad it happened. It changed the
course of my real estate investing business
forever.
I had a few Lonnie Deals in a mobile home park in
Plano Texas. The buyers paid on time but one day I
thought I'd drive through the park to check on the
homes and see if there were any other
opportunities.
What I found was shocking!
Half of the mobile homes in the park were empty.
So I went to the park manager to ask what was
going on. The park had been sold to a big company
in Colorado and they wanted all mobile homes moved
out of the park, including the vacant 64 rentals,
so they could expand the park in to a double wide
park.
Seemed like a stupid plan to me. Why would anyone
give up rental income like that? But I saw it as
an opportunity.
They were asking $2500 for each of the 64 mobile
homes. Some were 2 bedroom 2 bath but most were
large 3 bedroom 2 bath homes. Some of the homes
were only 10 years old and in excellent condition.
But what in the world would I do with 64 mobile
homes and how expensive would it be to get them
moved. I had a lot to figure out and knew I needed
to act fast before someone else got this deal.
I looked in to buying a mobile home park with 64
vacant spaces to move the homes to. But that would
make the whole deal too expensive and WAY TOO
RISKY.
The previous year I was a wholesale specialist.
I'd find an old home, get an option on it, then
sell the house to a rehabber. It seemed that plan
could work with these homes too.
I did some additional negotiating and got the
price down to $400 per home - but it was only to
be paid when the home was actually moved out of
the park. I paid $2200 for an option on all the
homes. And I got permission to have an "auction"
on-site at the park to sell the homes.
Instead of writing a check for $25,000+, I reduced
my risk by getting an option for $2200. The worst
that could happen was not selling any homes and
losing $2200
Then I ran an ad in the Dallas Morning News and
posted information about my mobile homes for sale
on all the REI forums. Buyers poured in from
everywhere. Some were investors looking for
"Lonnie Deals", some were park owners looking for
homes to fill vacant lots, and about 1/3 were home
owners. I did have a few guys buying homes for a
deer lease.
In two days, I sold all homes. Sales prices ranged
from $1500 to $8500. And it was their
responsibility to get the home moved out of the
park.
With cash in hand, I went back to the new owner
and negotiated a 10% discount if I paid for all
homes now instead of waiting for them to be moved.
So, instead of paying $400 per home, I paid $360
per home.
What an amazing ride! In less than a week, I got
an option on 64 homes then sold them for a HUGE
profit! This was my first package deal and my
first six figure payday!
Instead of making $3,000 - $5000 on one wholesale
deal, or a couple hundred dollars a month on a
Lonnie Deal...all the sudden I knew how to get a
six figure payday for about the same amount of work.
I wasn't looking for a package deal. I was scared
to death to take on 64 homes all at once but I
minimized my risk by using an OPTION.
From that day forward, I intentionally looked for
package deal opportunities which have much bigger profits
and is definitely FAST LANE
Forgot to mention.. that was 1997. I've done many many package deals since.
But boy am I glad it happened. It changed the
course of my real estate investing business
forever.
I had a few Lonnie Deals in a mobile home park in
Plano Texas. The buyers paid on time but one day I
thought I'd drive through the park to check on the
homes and see if there were any other
opportunities.
What I found was shocking!
Half of the mobile homes in the park were empty.
So I went to the park manager to ask what was
going on. The park had been sold to a big company
in Colorado and they wanted all mobile homes moved
out of the park, including the vacant 64 rentals,
so they could expand the park in to a double wide
park.
Seemed like a stupid plan to me. Why would anyone
give up rental income like that? But I saw it as
an opportunity.
They were asking $2500 for each of the 64 mobile
homes. Some were 2 bedroom 2 bath but most were
large 3 bedroom 2 bath homes. Some of the homes
were only 10 years old and in excellent condition.
But what in the world would I do with 64 mobile
homes and how expensive would it be to get them
moved. I had a lot to figure out and knew I needed
to act fast before someone else got this deal.
I looked in to buying a mobile home park with 64
vacant spaces to move the homes to. But that would
make the whole deal too expensive and WAY TOO
RISKY.
The previous year I was a wholesale specialist.
I'd find an old home, get an option on it, then
sell the house to a rehabber. It seemed that plan
could work with these homes too.
I did some additional negotiating and got the
price down to $400 per home - but it was only to
be paid when the home was actually moved out of
the park. I paid $2200 for an option on all the
homes. And I got permission to have an "auction"
on-site at the park to sell the homes.
Instead of writing a check for $25,000+, I reduced
my risk by getting an option for $2200. The worst
that could happen was not selling any homes and
losing $2200
Then I ran an ad in the Dallas Morning News and
posted information about my mobile homes for sale
on all the REI forums. Buyers poured in from
everywhere. Some were investors looking for
"Lonnie Deals", some were park owners looking for
homes to fill vacant lots, and about 1/3 were home
owners. I did have a few guys buying homes for a
deer lease.
In two days, I sold all homes. Sales prices ranged
from $1500 to $8500. And it was their
responsibility to get the home moved out of the
park.
With cash in hand, I went back to the new owner
and negotiated a 10% discount if I paid for all
homes now instead of waiting for them to be moved.
So, instead of paying $400 per home, I paid $360
per home.
What an amazing ride! In less than a week, I got
an option on 64 homes then sold them for a HUGE
profit! This was my first package deal and my
first six figure payday!
Instead of making $3,000 - $5000 on one wholesale
deal, or a couple hundred dollars a month on a
Lonnie Deal...all the sudden I knew how to get a
six figure payday for about the same amount of work.
I wasn't looking for a package deal. I was scared
to death to take on 64 homes all at once but I
minimized my risk by using an OPTION.
From that day forward, I intentionally looked for
package deal opportunities which have much bigger profits
and is definitely FAST LANE
Forgot to mention.. that was 1997. I've done many many package deals since.
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