MINDSET & MONEY | MY FIRST MOBILE HOME PARK

Thank you for joining me on the investing for freedom podcast. Today we’re going to continue the story of our real estate journey. You know, as I had mentioned before, first off you never really know where any journey or venture is going to take you. And I think it’s Gary Keller that said we tend to overestimate what we can do in one year and underestimate what we can do in 10, which was the case with us with our real estate goals, which is why it’s also so important that we adjust along the way. So Kara and I had, if you haven’t listened, you could go back and hear the story. But basically, we had determined that what we wanted was to buy two income producing properties a year for 10 years. And the reason why was when we got to 65 years old, we’d have 20 rental properties that were paid off. And that was kind of like our Big Hairy Audacious Goal as Jim Collins would say.

So in the first year we came back and we identified two properties, which I talked about in the previous two Monday podcasts. And then all of a sudden, this interesting thing happened. So I got a phone call one day from a guy that I knew who was a manager of a mobile home park. And we had been doing a lot of plumbing and heating in this mobile home park over the previous year or two years. His mom actually owned the park and she was having some financial challenges. She lived in Vegas and she needed to fire sell this park. Now this park had been for sale for, I believe the sell price was 1.2 million. We had actually looked at it and it just didn’t pencil out. It didn’t make sense. I hadn’t spent a lot of time looking at it, but my partner had. It didn’t make sense at 1.2 million. And so when I got this phone call, he was like, Hey, my mom’s selling this park. I’m mad about it. There’s an investor out of Las Vegas that’s probably going to buy this thing and I’d rather, you guys have it if you’re really interested. I said, what’s the deal? He said, well, there’s a first position note, private money note, which I think was at six and a quarter percent, six and a half percent, something like that. First position note $390,000 that’s assumable. And then she needs $80,000 cash. And you can take the deal. So $390,000 plus $80,000 on like $470,000 for a property that had been for sale for 1.2 million. And again, just because something’s for sale, doesn’t mean it’s worth it, it doesn’t mean you should buy it. But I think we had run the numbers and I think this deal probably made sense it at $800,000 or $900,000. So all of a sudden, I can get it for $470,000. Like this is an interesting deal. So we talk about this a lot, but the reticular activator, the eyes only see the ears only hear what the brain is looking for. Once you start changing and setting your intentions and you really start setting these goals, this is why this process so important. Not only does your brain start looking for opportunities, but opportunities start looking for you.

We’re not even going to talk about all of it through the series, but I can’t tell you how many times deals would come to me. Dolf De Roos used to say that you need to analyze a hundred deals to really look at 10, to make offers on three, to really close on one. And I believe that especially in times when it’s harder and harder to find deals, but I also believe that if you set your intention properly and you start talking about it and you start getting the word out there, you may not have to go through that formula because those deals might come find you, some of that’s relationship based. Some of that’s just opportunity based. But anyway, back to the mobile home park. So I said, yeah, I’m interested. Got the phone number of the guy that had the first position note called him. He said, I basically had said, Hey, we’ve been doing a lot of work. This is important. I explained to him that we had been doing a lot of work in the mobile home park community that I was in real estate, that I had a background in construction and plumbing and heating and why I was the perfect person to buy this park and for him to let me assume it. So never underestimate the power of going in and giving that seller or somebody who’s carrying a note or even a bank for that matter selling them on why you are the right person to loan you that money or let you take over that deal. Anyway, I had the conversation with him. He said, yes, no problem. I went to a mentor of mine, Barry, who, I’ve talked about a lot. I sat down with him. Barry actually had been an appraiser. He had been a County assessor. He owned many, many real estate investments. He had owned mobile home parks. I sat down with him and I just showed him the deal. And he literally looked at me and he said, you’re lucky, you’re my friend or I would steal this thing. And if you’ve listened to the podcast of Barry, you probably heard part of that story. So I’m sitting there and he’s like, basically go buy this thing. And I’m like, well, she need to close it in 15

days. Cause she was having some again financial challenges.

I was concerned about that. I’d never bought a mobile home park. In fact, I’d only really bought two single families. I’m like, how do I close in 15 days? The title company, they can’t get a title search done. They can’t get everything done in 15 days. He said, go talk to title loan. And as long as they can get a preliminary title search done, let’s just March forward. It’s that good of a deal. I’m like, okay, great. I’m still sitting there. He’s like, why are you still here? Yeah. I don’t think that’s exactly how it went, but why are you still here? I didn’t have the $80,000. We had a successful plumbing and heating company, but it was just growing. Yeah, I’d bought a couple of rentals, but I wasn’t sitting on a lot of cash. So I didn’t have the $80,000 cash. He looked at me and he said, I will loan you the $80,000 cash in a second position. So hear me here. He’s given me the down payment. The guy that had the first position now is letting me assume the note. So I’m buying a 72-space mobile home park with no money down. I’m like, wow! What’s the problem with

that? I was concerned about going from, remember, I had set a goal for two income producing properties a year for 10 years, and I had two and I was just really getting my feet wet with real estate. And I’d been listening to Dolf De Roos. He was talking about single family rentals. My goal was single family rentals. Now all of a sudden, there’s this 72-space mobile home park in my lap. That’s like literally three and a half exiting my goal for 10 years. Three and a half timesing it in year two. I’m like, I’m nervous. I’m scared. I don’t know anything about mobile home park investing.

I’m so focused on my goal, if I didn’t adjust, I would’ve passed this opportunity. But I was sitting there in front of Barry and I’m scared. I’m nervous. I’m like, I don’t know anything about running a mobile home parks. He said, don’t worry about it. I’ll help you through the process. That’s the importance of mentors. This is literally what he said to me. If anything goes wrong, I’ll be in a second position. I’ll take the first position out. I’ll take the park over and I’ll take it. And he didn’t mean that from a repossession standpoint, like he would buy me out of it. There was no risk. I had a mentor who was going to help me, who was going to loan me the second position first, the down payment in second position. And I had a guy who was willing to let me carry or let me assume the note. So I buy this mobile home park for $470,000, no money down, 72 spaces, that thing cash flowed from the beginning. And we still own it today in another investment group has just taught me a ton over the years, brought me a ton of value. We’ve leveraged it several times. I sold it to another investment group. It’s just been an amazing experience. And here’s the bottom line. If I hadn’t set the goal of changing my mindset, two income producing properties a year for 10 years, I don’t know that I would have even seen that opportunity, or the opportunity would have even come to me. But even if it did, I don’t know that I would have went right to a 72-space mobile home park.

So the lesson here is just be flexible in your goals, again, what you really want. Why do you want it? What are you going to do to get it, measure results? But adjust, that adjusting is so important. Because I can’t imagine looking backwards if I would have said no, my goal was to get two income producing properties in this second year, and this is 72. I’m not going to go after that. And also my goal was single family, and this is such a great opportunity, but it’s multifamily essentially a mobile home parks. I don’t know that; I don’t know where I’d be today. And even in our business today, we go out and we acquire a mobile homes, mobile home parks. We put investment groups together. That was the beginning of where my journey went, four peaks capital partners. We have 35 mobile home park communities in 13 States. That all started with that one mobile home park. And

what if I had said, no, that’s not part of my goals. I’m not adjusting. So the reticular activator is so important. The eyes only see the ears only hear what the brain is looking for. You got to remain flexible. You got to adjust along the way.

And as Jim Collins says, the BHAG, the big, hairy, audacious goal. Sometimes we think we’re setting a BHAG and it’s a stretch for us, but it’s interesting how the universe comes alongside of us and people that are smarter than us and opportunities that are better than what we were dreaming, come to us. And with that perfect circle, we’re able to leverage all that and life ends up being better than what we could even imagine. So just go out there and keep your mind open, make sure you’ve got your goal set. Make sure you’re dreaming big, but at the same time, be flexible enough to where you look at the opportunities that come at you, even if it’s a little bit different than how you thought it was going to look.