Deals on Wheels
by Lonnie Scruggs
I came across an ad for Deals on Wheels by Lonnie Scruggs several years ago when I was looking for a way to make some money with real estate without making a huge investment. Actually, after I read the book I found that Deals on Wheels has little to do with real estate. The book basically walks an investor step by step through the process of creating notes that pay very good interest. The notes are backed up by used mobile homes.
Why mobile homes? Well the notes could be secured by any form of collateral, but mobile homes make particularly good collateral for several reasons. Most buyers of mobile homes can't pay cash, but banks will not loan money towards the purchase of a used mobile home. That presents a window of opportunity for an individual who loans money to the buyer at a nice, but not usurious, interest rate.
It is expensive to move a mobile home, so generally an owner who is going through a life transition that requires a move has to sell it rather than take it with him. Since most who are looking for a mobile home can't pay cash, the pool of potential buyers is dramatically reduced. So those who can pay cash will often get a very good deal. By taking a small down payment (but as much as the buyer can afford), and holding a note, the investor can often double his money on the sales price in addition to making money on the note. Lonnie Scruggs explains in the book how the mark-up plus interest can bring a 75% return (or more)! You might be wondering why it wouldn't be better to use the home as a rental property. Renting the property, the money would continue to flow to the investor for a longer period of time, but the investor would also have to take care of any repair issues. Once the home is sold, it is the new owner's responsibility to take fix roofs and sagging floors, replace appliances, and replace broken windows. All the investor has to do from the point of sale forward is collect the monthly payments (assuming he doesn't have to repossess the home). Probably the number one question regarding loaning money for a mobile home is "what happens if they don't pay?" As Lonnie Scruggs explains, that is not usually a bad thing. Since a mobile home is not real estate, you don't have to evict the tenants. You just repossess the mobile home. You keep all money that has been paid thus far, and find another buyer. The book will show you what kind of homes to buy, how to use "problems" to negotiate better deals, how to find the right buyers and much more. Sample legal forms are even included. No doubt it is a going to be easier to get started in this business if you have a little cash to invest, but Scruggs will show you how to get started even if you don't have any money. Deals on Wheels is an informative book written in an entertaining, conversational tone. Lonnie Scruggs seems to really care about your success. Even if after reading the book you decide buying and selling mobile homes is not for you, you will have learned a lot about investing.
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