Welcome to episode 8 of the Mobile Home Park Investors podcast, hosted by Jefferson Lilly and Brad Johnson, with the Park Street Partners. Today, Jefferson and Brad will discuss seller carry, also known as seller financing. This is when a seller of a mobile home park carries back the mortgage, which allows the owner of the mobile home park to not have to deal with a bank to get a mortgage and to close a deal more quickly.
[1:29] It’s best to negotiate directly with the seller, even if buying property through a broker.
[2:30] What are the benefits for a seller to carry back the mortgage?
[7:53] Brad explains the depreciation recapture component of seller financing.
[10:07] The downside for a seller to carry back the mortgage is de minimis.
[12:37] The best part about seller financing.
[13:19] A key benefit for a seller who offers seller carry.
[13:42] What to do once you agree to seller financing.
[16:17] Much easier to get a deal done when a seller agrees to let you pay them back over time.
[16:32] Another benefit for the seller to carry back paper.
[17:52] It’s important to treat your sellers well; and they can serve as a reference for you.
[19:25] Negotiating the debt documents, cure rights, and the promissory note.