Mobile Home Park Financing

Mobile home parks are financed as commercial property, rather than residential property. Lenders evaluate occupancy levels, rents at the park and in the current market, whether or not it has paved streets, etc. These factors determine how much of a loan they can give to a perspective park owner. A commercial appraisal should be done on the park prior to purchase, which can be done by many lenders for a fee.

Mobile home financing depends heavily on what the park is generating in income. Mobile home financers look at all of the income and work the expenses into their analysis to make sure the deal makes sense. Occupancy level and the density of park-owned homes are important factors to mobile home financers.

Typically, there is better mobile home financing for loans over $500,000. The property is looked at closer than the client, in some ways, because the mobile home park is the collateral. Potential owners should have a credit score of over 680, and assents to cover the down payment, but many lenders are more concerned that the income from the property will cover the debt on the asset.

Most mobile home financing is offered in 30 year amortized loans. The typical holding time for mobile home parks is about 10 years. Buyers are usually looking to purchase a park, generate income, and then sell.

Many mobile home park buyers create LLC's specifically for that property, to limit liability.

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