David Butler is the author of Tin Can Alley-The Stairway to Heaven?.  In his book Mr. Butler addresses a real estate arena not explored as in-depth as regular real estate ventures.  He deals with mobile home paper.  Some mobile home notes are real estate notes also but it doesn’t really matter Mr. Butler says.

“The mobile home note arena is a marketplace that is vastly overlooked and somewhat mysterious for most note brokers, and investors too for that matter! And when I speak of mobile home paper, I am primarily talking about notes that are secured by mobile homes located in mobile home parks. These notes are not real estate notes per se, but they are negotiable cash flow contracts secured by residences, so they do have a very common bond with real estate paper.”

Traditionally mobile home notes were considered personal property but they are still single-family dwellings.  They are rarely moved from where they are delivered to and they have no land title.  “Mobile home notes are bought and sold with very similar analytical procedures and title transfer protocols as real estate paper, with only slight variation. Lien perfection, recordation, orderly foreclosure processes, assignments of interest, insurance coverage, lender in possession, etc., all run along the same lines as the more traditional real estate notes to some degree, so experienced note brokers should be able to do both kinds of note transactions fairly easily.“

Some of the other advantages of working notes on mobile homes in parks include free park management, less isolation than mobile homes on land, up-to-date on possible defaults, more notes available in mobile home areas because there are fewer lenders financing this kind of loan, and significantly higher yields on invested funds due to the limited playing field. Butler teaches you how to enhance yields due to more opportunity for restructuring note payment rates and to speed up the receipt of the discontinued yield spread premium through partial purchase and split funding options. Additionally there is less expensive titling, escrow, recordation, transferring and repossessing the security.  You just have an easier job of marketing to get the notes to work in the first place.