Mobile Home Notes
Following are the basics, in outline form, of the most secure, saleable, seller financed mobile home notes. Please note this outline is specific
for home only/chattel loans in land leased communities. While I understand some of the possible benefits of lease options, they are not
sellable in the secondary market.
First a Mobile Home Sale with seller financing:
1. Sell the property to a buyer who will occupy it (called owner occupied). Get an appraisal or blue book value and sell for no more than the
maximum appraised value.
2. Sell the property to a buyer whose mid credit score is at least 625. The higher the better.
3. Sell the property to someone that has the income to more than cover the payments. Always get a qualified co-signer when possible such
as a parent or grand parent or employer!
4. Sell the property to a buyer who you don't know and isn't related to you.
(Called an arm's length transaction).
5. Use a retail installment sales contract with all of the truth in lending disclosures. Make sure this is state approved.
6. Put the title into the buyers name with you or your company listed as the first position lien holder. Some states have processes in place
that allow you to maintain control over the actual title.
Do this at all cost.
7. Take back a Promissory Note in the first position (the most senior lien) for no more than 80% of the sales price.
8. Have the buyer(s) get hazard insurance with you or your company listed as loss payee and additional insured for no less than the note
9. Significant and detailed late and default payment stipulations.
10. Loan terms should be kept as short as possible and no longer than 180 months. The shorter the better.
11. You should have an abandonment clause in your contract and Limited Power of Attorney that allows you to sign the buyers name on the
title in case of default.
12. Interest rates should be between 8% and 10% .
13. Keep detailed records of the note and each payment (preferably a copy of the front and back of the payment check showing the bank
cancellation stamp). Preferably a separate checking or savings account for the note.
14. Remember this is a common sense and "people" business. You have to work with these types of people so chose buyers you feel
comfortable "working" with.
We Will Need The Following Information To Process Your Note for Sale.
1) Is the Mobile Home a Double Wide or Single Wide?
2) Who is the Manufacturer?
3) What Year was the Mobile Home built?
4) How large is the Land Lot?
5) Is the Mobile Home served by Municipal Water & Sewer, or Well & Septic?
6) Is the Land Rented or does the Land come with the Mobile Home?
OTHER BASIC QUESTIONS ON ANY NOTE:
7) What is the Exact Property Address?
8) Is the property Owner-Occupied?
9) Do you have a Property Appraisal? Date?
10) Do you know the Credit Score of the Note Payor?
11) What does the Note Payor do for a living?
12) What Day & Month was the 1st Note Payment made?
13) What is the Interest Rate? ___% Fixed or Adjustable?
14) Amount of the Monthly Payments? $___________
15) Any Balloon Payment? Amount? When Due?
16) Does Note Holder have a Mortgagee's Title Insurance Policy on the Note?
17) What Escrow/Title Insurance Company handled the transaction?
18) Is this Note Seller-Financed? or Lender Purchase-Money? or Lender Refi?
Office Phone 909 474-1386
email us at: notebuyers1