Commercial Financing by Lightning Commercial Funding, Inc.
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Mobile Home Parks, Manufactured Home Communities & RV Parks


Why would anyone want to buy Mobile Home Parks?

More and more investors are contacting us to help them finance the purchase of a Mobile Home Park, Manufactured Home Communities, Manufactured Home Communities but again I ask you why?

The reason is very simple THEY ARE A CASH COW! as so aptly said by our recent investor, Michael C. from San Diego.

Michaels’ company is a development firm that is constantly looking to purchase existing parks. His company loves the cash flow from the leases. His company turned to our firm to help secure financing for a park that was located out of state.

We were able to secure a great Mobile Home Park Loan for him at very attractive rates and points, the problem was that at the end of the day we were unable to close the loan because the property did not appraise at the purchase price.

So why would I talk about a loan that did not close...

It is to make a point that we can learn from misfortunes, and what we learned was that no matter how the property cash flowed, a key ingredient of a mobile home park as with other commercial ventures is the final appraisal of the property by the lender

A cardinal rule when working with a lender is not to contract with an appraiser. Most lenders will not accept an appraisal that they did not order. So save your money and let the lender order the appraisal or you may wind up having to pay for two appraisals.

The investors were a bit gun shy on this transaction because the owner of the park owned more than 25% of the coaches. Another key underwriting point is that the investors or lenders do not like to lend on parks that own the coaches outright as well.

Many of the lenders that specialize in the area of mobile home park loans will not lend on park owned coaches. In actuality they will deduct the fair market value of any park owned coach from the purchase prices.

Most parks are owned by an investor who leases out the spaces to the owner of the individual mobile homes. The investor then gets monthly a rent check with none of the traditional headaches that come along with traditional multi family income properties.

The rental income for the individually owned units remains in place for as long as the owner or the tenant of the mobile home has his space in the park. Many of the nicer parks also have other income based amenities that increase the projects bottom line.

For further discussion on the underwriting requirements for Mobile Home Parks.


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