Investing 101: Is Mobile Home Investing Right For Me?

So, I was all set to write another "Deal or No Deal" case study type post today but then I changed my mind. I'd like to take a moment and get away from the mobile home case study series for this post and write about something that has been on my mind lately.

Recently, there have been folks who have contacted me about their interest in mobile home investing. Many have told me they have heard a lot of stories from other investors about mobile homes being the best type of investment vehicle out there and also the one having the best return on investment.

But, the question that is asked of me is this "Is mobile home investing this great? Can I make a lot of cash flow from investing in mobile homes and have great returns? And, if so do you think it's for me?"

In all honesty, I cannot answer that question. Why?

The reason being is that it's different for everyone. I don't think mobile home investing is the best type of investment vehicle and has the best returns for everyone - it just doesen't work out that way. I've said this before, it's all a matter of personality. What works for one person, may not work for you. And, vice versa.

I'm sure this may seem kind of odd for me to say being that I write a blog about mobile home investing. But, the goal of my blog is not to convince others to invest in mobile homes. The goal of my blog is to share my adventures and stories about my experience investing in mobile homes. That is all.

Personally, I don't think folks out there should base their decision to go into mobile home investing solely on stories they've heard from other investors about all the money they have made and the types of returns they've made from mobile home investing.

Honestly, this business takes work - hard work. And, success doesen't happen overnight. Just like any business, it takes a lot of time and persistence to make it work. But, when it does - it can be worth it.

The important thing is to be mentally prepared and ready. When I first made the decision to go into mobile home investing, I knew this is what I wanted to do. I made many sacrifices, I gave up a lot of things.

(Note: For those interested, feel free to check out this article on why I enjoy investing in mobile homes).

I remember many a nights reading, studying and then taking action on what I had learned. It took time, a lot of time. And, there were moments where I kept asking myself "What in the world am I doing? Is this going to work?" But, I kept pressing on.

I took the time to really learn the ins and outs of the business. And, did what I had to do to get to my first mobile home deal - it took me almost a year. After completing my first deal, I can say I really learned a lot. Though it took a lot of time and hard work, I can honestly say that I found that I did enjoy the business.

And, this is what it's all about. When folks have asked me about whether or not they should pursue mobile home investing, I tell them straight out - try it out and see if you like it. Honestly, not everyone that has tried it has liked it.

I remember one investor in particular who did one "Lonnie Deal" (a fellow rehabber) and told me it just wasn't for him. He told me if he was going to spend all his time on something, it would be doing something that he enjoys - rehabbing properties and selling retail for a lump sum. He just didn't feel that collecting a check for a couple hundred dollars was worth all the time and effort. And, that's ok.

So, for those who are interested in mobile home investing I highly urge you to think about why you are interested in it. If you are interested in this business solely for the money, I urge you to think it through.

Honestly, there are much more easier ways to make a lot of money - it's called having a high paying job. Being an entrepreneur and starting a business takes a lot of work. The rewards can be great but the payoff does not happen overnight.

In Thomas Stanley's book, The Millionaire Next Door, he even states that many millionaires think it much easier for their kids to go to school, become a professional and have a high paying job than to go out and start a business.

If I were interested solely in making a lot of money quicker, I'd go out and do the same thing. Though, I did not.

(Note: Growing up, I was always an entrepreneur at heart. I had many entrepreunerial ventures as a kid and this followed me even as an adult - it's always been a part of me).

This all really comes back to really knowing who you are and what kind of life you want for yourself. For me personally, I know I've always been an entrepreneur. That is why I keep saying for me it's not just about the money. It really isn't.

(Note: For those who are interested in why I went into mobile home investing in the first place, feel free to check out this video).

I had a chance to take the path of the kids of The Millionaire Next Door. As an undergrad, I was chosen for a fellowship in a pre-MBA program at a top tier business school.

Though, my mentor (who was already enrolled and attending the MBA program) told me - I just didn't belong there. She told me this just wasn't for me because she saw the "entrepreneur" inside of me.

(Note: Even as a student with classes and a working job, I still had the time to have my entrepreneurial ventures. And, yes I ran these ventures out of my apt - my roommates thought I was crazy!)

My mentor encouraged me to go out and pursue my entrepreneurial ventures in the real world as business school did not teach this - they taught management. Furthermore, she went on to tell me that business school does not churn out entrepreneurs - they churned out managers, investment bankers and consultants. So, I took her advice to heart. And, here I am.

So, my point is to really take the time to know who you are and why you want to do the things you're interested in. Honestly, it's really easy to get caught up in all the hype of things (especially in real estate investing).

Though, at the end of the day what's important is doing the best thing for you and your family. And remember, the right thing to do can only be decided by one person. And, that is you.

(Note: Thank you for taking the time to read this post. Though it seems pretty deep, I felt the need to say these things due to all the inquiries I've received from folks seeking advice on this topic).

I'm going to leave you here with a video from Seth Godin that inspired this post.

Happy Investing!

p.s. Feel free to leave comments on any post either here and/or my Facebook Page. Comments are always welcome, thanks for reading!



Video Link

Terminology Tuesday (Tricks of the Trade) - Covering Up a Hitch

(Note: I think it's important to know the terminology and words used when learning any new business including mobile home investing. I came up with 'Terminology Tuesday' as a way to go over the terminology used in the mobile home business. It's important to know the terminology when talking to people in the business so you're all on the same page).

**** Tricks of the Trade is a new series I have started that will be included with "Terminology Tuesday" posts. The goal of this series is to share with you the "tricks of the trade" I have learned in the mobile home business.



Recently, I've had to deal with an issue on this deal - covering up a hitch.

Since I only deal with high end parks now due to this experience, the majority of these parks have strict regulations regarding hitches - they are prohibited from being seen. Usually, in the more low end parks - hitches are allowed to be in plain view. And, in most cases - there are many hitches to be seen in these type parks.

In all honesty, I think it is more an aesthetic issue than anything. Having the hitches not in view just makes the park and the overall community look nicer (in my opinion). So, I can see why hitches are prohibited from being seen in most high end parks.

Since I have a good relationship with the park manager for this deal, I was allowed to cover the hitch. Now, the park manager did tell me in their rules and regulations that it states all hitches in the parks must be removed and placed underneath the homes. Though, the park manager told me I wouldn't be made to do this as it costs quite a bit of money just to raise the home and remove the hitch. This is the power of building strong relationships.

So, you may be asking yourself - why do I have to deal with this issue and not the previous owner?

Well, when I negotiated this deal with the previous owner the hitch was actually covered. Awhile back, the previous management had planted bushes in the park which had covered up the hitch. Though, this bush really grew out of control. And, I didn't like it one bit. Here's a snapshot:



(Note: In addition, I had to also find someone to cut this bush down. (Talk about major stress issues!) Went through a bit of drama interviewing and getting bids from a few contractors but finally found a guy who could do it. And, he did a great job!)

Once the bushes were removed and cut down, then the hitch was exposed and the home looked like this:



Once the hitch was exposed, I took some measurements. I measured 12 inches off the ground (which was great as it wasn't too high) and 50 inches across for the sides and height of the hitch.

(Note: For those who are new to the mobile home business, in most cases the length of the hitch is standard - usually 4 feet long. And, this 4 feet gets added to the overall length of the home. For example, a 16x76 foot long home with a hitch would actually be 16x80 foot long (if you count the hitch).

In any case, I asked the park manager for a few ideas to cover the hitch. The park manager told me there are several things that I could do, but all that mattered was that it looked nice. Ok, but that is so subjective! Something that looks nice to one person may not look nice to another. I was really stressing about this!

Though, the park manager assured me this was not a big issue. The park manager told me to go around the park and get ideas by looking at what others have done. A few suggestions were to cover up the hitch in lattice, build a box around it, or use some bricks to cover it up. So, I went around the park to get a few ideas. (Talk about ridiculous!)

Here's what I found:

Good



Better



Not that great



After checking out what others had done in the park, I took a trip to the local hardware store (aka Home Depot and Lowe's). And, after much deliberation came up with this:



Now, here's what the home looks like with the newly covered hitch:



After I completed the project, I was really relieved just to get it done. Now, the hitch is covered (per park regulations). And, I can honestly say this has definitely been another new and educational learning experience for me.

I hope this "Terminology Tuesday" post has been helpful and has given you some useful information to use - it definitely has for me.

Happy investing!

p.s. Feel free to leave comments on any post either here and/or my Facebook Page. Comments are always welcome, thanks for reading!

Investing 101: Why I Focus on Building Relationships

(Note: Image courtesy of LumaxArt)

Lately, I've been contacted by many folks who tell me they are having a hard time finding deals in their market. And for those who have found a potential deal, many have told me they just don't know if it's a deal or not. So, things don't really work out.

Listening to these stories and the struggles involved really brings me back to my early days in sales. In the beginning, I really wanted to make things work. So, I asked the top sales rep for some advice. And, you know what he told me?

He told me the key to being successful was to stand apart from the rest - don't be like everyone else. Don't go chasing after business the way everyone else does. Make people want to see you, want to do business with you. And, the only way you're going to do that is by building relationships. By building relationships, you do one thing that most don't do - you build trust.

By building trust, it's not going to matter - people will automatically want to work with you, want to help you. But, if you don't take the time to build relationships and earn that trust - why should they do business or want to help you in the first place?

There is one more thing he told me that I will never forget. He said, "Don't focus on the sale. Focus on building relationships. If you do that, you won't have to worry - business will come to you."

And, I took his advice to heart. In the beginning, it was a bit of a struggle - it took up a lot of my time. I was having many meetings with the same people, yet nothing seemed to be going anywhere. I wanted that immediate sale, that immediate gratification. It seemed like an eternity.

Though, the top sales rep kept telling me to stay with it - be patient, be persistent and it will come. And then, he told me - when it comes, it will come big time.

So, I stayed with it. I took meetings, I showed up. And, I kept showing up. I showed up to the point where things finally started happening. I remember meeting with the CFO of one company at 6am in the morning. Many of my other peers thought I was crazy.

The top sales rep told me to do it. He told me our hours are not built around 9-5. If you have to meet people outside regular business hours, do it. If you do the things that most are not willing to do, it will be worth it. I guarantee it.

So, I continued to follow his advice. And, you know what? It worked.

Though it took time and I felt behind from the rest, I soon excelled among my peers. Within a short time, I was in the top 3 among my peers.

What I learned from this experience was the value and importance of taking the time to build relationships. Though it can seem very slow at first and feel like an eternity, it's important for the long term.

Just like the story of the turtle and the hare, it is the hare who had a fast start but guess who won the race? The turtle.

Much of what I do and my style of doing things has come from my sales experience. I learned firsthand the importance of building relationships and taking the time to do one thing that most don't do - CARE.

Honestly, despite all my formal sales training and seminars I attended (as there were many) - the one thing I learned in business was that it takes heart to succeed.

Having heart sets me apart from the rest. If I take the time to care about others, they will take the time to care about me. Even if it does not lead to business or a sale, it has all come back threefold with referrals.

For me personally, I know my approach sets me apart from everyone else. Just recently, I had a closing on this deal.

After the closing, the sellers told me they were so happy to have met me - they told me now they felt I was like family. And, it felt like they've known me forever(No kidding, their exact words!). They went on to say that I really do things differently from all those other investors. And, they personally invited me for a visit to their farm to experience true, country living.

It is situations like these that really make things worth it in the end - it's the mutual appreciation on both sides of the table. Does this happen all the time? No. But, when it does - it's definitely worth it.

For those out there who find themselves struggling or having a difficult time in this business, I urge you to re-evaluate what you are doing and how you are doing things. Are you doing things like everyone else? Or, are you different? What sets you apart from the rest?

Just like the advice the top sales rep gave me, if you can learn to stand out and be different from everyone else - you will succeed.

I'm going to leave you here with a video from Seth Godin that inspired this post.

Happy Investing!

p.s. Feel free to leave comments on any post either here and/or my Facebook Page. Comments are always welcome, thanks for reading!



Video Link

Terminology Tuesday - How to Hire a Contractor

(Note: I think it's important to know the terminology and words used when learning any new business including mobile home investing. I came up with 'Terminology Tuesday' as a way to go over the terminology used in the mobile home business. It's important to know the terminology when talking to people in the business so you're all on the same page).



Video Link

This is a short video on how to hire a contractor.

Learning how to hire good people is a skill I've learned over the years through experience. In the early days, I relied mostly on referrals and for the most part - they weren't that great. I ended up spending a lot of money and a lot of time for people who were not the best and who ended up overcharging me.

Sure, there are big companies out there that do good work. But, what I've learned is that I prefer to work with the little guys. These are the folks who are on the streets, just like me, day in and day out - just working to make a living. And, I find that I prefer to deal with small, family type businesses when it comes to working with contractors.

For the most part, I only deal with contractors who specifically work on mobile homes and in parks. Since this is really a niche business, I want to know the folks I'm dealing with are familiar with mobile homes and the parks I work in.

Lately, I've been receiving many calls from contractors who have dealt with mostly single family homes. When they call, a lot of these folks tell me they know how to fix pretty much everything and mobile homes are just like single family homes. So not true. They are built differently, they are not the same.

So, how do I screen and hire contractors? Well, it's really a matter of preference. Usually, I will work with the park to see who they use for their jobs. But, I'm also sure to check around with the homeowners in the parks I work in - I have found many good and reliable contractors just by talking with the homeowners in the parks.

I always have a few contractors for each type of job lined up. And, I'm constantly interviewing and looking for contractors. I have learned not to rely on one person for everything. Things change, situations change. People change.

For example, recently I had to do a job on a furnace unit that needed to be fixed. Apparently, it had been leaking water when the a/c was turned on.

Well, I had my heating and a/c guy take a look at it. He told me in order to stop the water from leaking the coils would need to be replaced in order to stop the leaking water. He told me it just was no good anymore and that was the only way to stop the water from leaking from the unit.

So, I asked him what this was going to cost me. He quoted me $975. My jaw almost dropped to the floor, I was in shock! Just for that, I asked him if he was serious. He said "yes." I asked him again if there was any other way we could repair the problem, he told me "no."

In any case, I told him to go ahead and fax me the estimate (I always get estimates in writing) and I'd have to look it over again. After hearing this news, I just didn't feel good - I felt this was really a high price for a job like this.

Though a part of me kept saying, "You've used this guy for awhile now, he knows what he's talking about." On the other hand, another part of me was saying "You know what, you better do your research on this before you make a decision. Maybe you should check around and get a second opinion."

So, I did a bit of research on the issue. Turns out, what I researched and found was sometimes the issue could be minor - the coils may not need replacing. But, if they do the $975 figure was just average. The price ranges for this type of job ranged from $700 on the low end to $1500 on the high end. I was advised to get a second opinion. So, I did. And, I'm glad.

I talked to another heating and a/c guy who's been in the business for 10 years, fully licensed and everything. What I liked about this guy was that he was familiar with mobile homes and had done business in the park.

Moreover, he knew exactly the problem - he told me he was familiar with this problem and have seen it in many mobile homes. Thing is, he was familiar with the type of furnace unit since he's had experience in mobile homes.

Turns out, the problem was the coils. But, they didn't have to be replaced. He told me all they need is a cleaning and the pipes just need to be cleaned and unclogged. He explained to me that when the a/c is turned on if the coils are dirty and dirt is blocking the exit then water cannot escape - it gets stuck. And, when it gets stuck then it just sits there and does not go anywhere - that is the cause of the leak.

Furthermore, he told me once the coils are cleaned as well as the pipes of all the dirt and debris - then the water can evaporate and escape from the home. He told me this is just like a car, all it needs is a good maintenance and tune up.

So, I ended up using this guy and guess what? It cost me less money. Instead of $975 with the first guy, I received an estimate of $200 with the second. This is a $775 price difference just by getting a second opinion!

But, here's the kicker about the story. Turns out my original a/c and heating guy, he was no longer licensed. I checked him out in the licensing database and he was no longer listed. I remember awhile back, I had a hard time reaching him as his phone number was disconnected. I checked his license and it said "Expired." Now it turns out, he is no longer licensed.

The lesson I've learned is that I cannot always depend on one person for the job, I have to always be out there looking for folks to add to my team. Situations change, people change - things don't always remain the same.

I hope this "Terminology Tuesday" post has been helpful and has given you some useful information to use both in your business as well as your personal life - it definitely has for me.

Happy investing!

p.s. Feel free to leave comments on any post either here and/or my Facebook Page. Comments are always welcome, thanks for reading!

Must Know Investing: "The Best and Brightest Women in REI" Series

(Note: This image was created by my pal Julie's graphic designer for an award Julie personally gave me (click on image to view). Thanks Julie!)

So, I was all set to write a long "Investing 101" type blog post this morning (I am a really early riser!) but changed my mind. Honestly, it's been a long week. I've been dealing with both park management and contractors issues this week. To say the least, it's been chaotic.

In two of my favorite parks, there has been changes in personnel. To say the least, it's been sudden. I've been in emergency meetings with the park management and maintenance teams all week. I've dealt with this before with a few of my parks in the past. And, with change - comes a new team.

Since I've had a long term relationship with these parks, the staff already knows me (They are the ones who vouch for me!). So, when changes in personnel occur it's always a new training exercise to get to know the new folks.

Surprisingly, it's funny because a lot of times the new folks can seem pretty overwhelmed by everything and I go in there and try to make them relax. A lot of times, they feel relieved there is someone there who is willing to help and listen to what they're going through.

In any case, I will save this post for another day. And, go into a whole different topic.

Last month, I wrote a post regarding the Must Know Investing Series, "The Best and Brightest Women in Real Estate Investing."

In any case, I wanted to let everyone know that the videos are out for the series. I encourage everyone here to check them out as they are very educational and informative. Here they are (in the order of appearance):

Julie Broad (Life as Real Estate Investors and Rev N You)
Esi Benedict (Flipping Mom)
Shae Bynes (Good Faith Investing)
Christina Mellott (Real Estate Investor Mom)
Steph Davis (Flip This Wholesaler)
Patricia Ridelle (Must Know Investing)
Me ----> Mobile Home Gurl
Susan Lassiter-Lyons (The Investor Insights) - Stay tuned next week!

Thank you Patrick for putting this together! I had a really good time participating in the series and getting to know some really cool gals.

If you haven't had a chance, definitely check out the Must Know Investing site - it's definitely a great educational site to learn more about real estate investing. Thanks for reading!

p.s. Feel free to leave comments on any post either here and/or my Facebook Page. Comments are always welcome, thanks for reading!

Terminology Tuesday - Notary

(Note: I think it's important to know the terminology and words used when learning any new business including mobile home investing. I came up with 'Terminology Tuesday' as a way to go over the terminology used in the mobile home business. It's important to know the terminology when talking to people in the business so you're all on the same page).



According to Wikipedia:

"A notary is a lawyer or person with legal training who is licensed by the state to perform acts in legal affairs, in particular witnessing signatures on documents. The form that the notarial profession takes varies with local legal systems.

Most common law systems have what is called in the United States a notary public, a public official who notarizes legal documents and who can also administer and take oaths and affirmations, among other tasks. In the United States, a Signing agent, also known as a Loan Signing Agent, is a Notary Public who specializes in notarizing mortgage/real estate documents. Although notaries public are public officials, they are not paid by the government; they may obtain income by charging fees, provide free services in connection with other employment (for example, bank employees), or may provide free services for the public good."

Source Link

For me, I use a notary for all my mobile home transactions - both on the seller and the buyer end. Is it required? Not all the time. But, it's just an extra precaution that I use just in case an issue comes up down the road.

If there ever were to be an issue on the seller end (such as a title issue) or the buyer end (such as a payment issue), having my documents notarized is proof that the folks I'm dealing with have been verified and confirmed by a third party.

(Note: Some investors use a Power of Attorney on the seller end - this is another tool you may want to use. Though, I don't really use it. It will really depend on your area and what is acceptable. In mine, if there's a notarized signature on a particular document - that is acceptable and can serve just like a Power of Attorney for that particular issue as the document is signed and notarized by the individual in question. Again, it's best to check and know the laws in your particular area).

In the mobile home business, things can seem a little bit more "laxed" than in the real estate world. Though, coming from the real estate world - I can be a bit paranoid about these things (I've been told this by a few of my fellow mobile home investors!). My philosophy is that it's better to be safe than sorry. Though, that's just me.

Most of my fellow mobile home investors don't really go this route when buying just mobile homes (not the land). To them, it's a bit of a hassle. Though, I do take the extra step and precaution to get all my documents notarized.

Regarding notary services, I don't really use a mobile notary. In my opinion, they are too expensive for what I'm doing ($100+ per trip out).

On the seller end, usually we get the documents notarized either at a local bank (they usually do this for free and offer it as a service to their customers) or at a mail services store (such as Mail Boxes Etc).

On the buyer end, in some cases the park manager may be a notary for the park. Or, we go the above route.

In the beginning, I did use a fellow investor who was a notary who wanted to learn first hand from me about the mobile home business. We would meet with either the buyers and/or sellers - this fellow investor would notarize all documents free of charge.

It worked out ok for awhile. Though, this fellow investor got more busy and informed me it wasn't something that could be done on a regular basis anymore. I think this fellow investor just wanted to get a peek for the mobile home business, but told me it might be something down the road for them but not at that time. So, we parted ways.

(Note: I think it's ok to go this route in the beginning (when you don't have too many transactions). But, after awhile it can be a bit tedious for the person on the other end when dealing with multiple transactions. So, I just go with an established institution like a bank or company (such as a bank) that performs this service on a regular basis).

To give you a better idea of when and why to use a notary, here's a short video:



Video Link

Again, using the services of a notary will be an individual and case by case decision. It's not always required in the mobile home world. Though, for me using one gives me piece of mind just in case an issue comes up in the future.

I hope this "Terminology Tuesday" post has been helpful.

Happy investing!

p.s. Feel free to leave comments on any post either here and/or my Facebook Page. Comments are always welcome, thanks for reading!

Hiatus

Hi Everyone!

The blog will be on hiatus this week. Will be back next week, stay tuned!