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 Buyer Prefers Easier Process and Flexible Loan Term for 5-STAR 55+ Park

The Mobile Home Park Refinancing Loan of a Senior San Bernardino County mobile home park was completed on August 1, 2007 for $4,990,000 with a regional portfolio lender.  Vince Reynolds and Norman Sangalang of MHRV Advisors represented owner in this transaction. 

The 55+ five star mobile home park included amenities including an office, laundry room, pool, playground and clubhouse. The park was built in the mid 1980’s with 2/3 of the spaces added in 2005. The new $4,990,000 note and first trust deed variable rate loan is fixed at 6.875% for ten years and fully amortized over 30 years.  The interest rate may be slightly higher than a conduit type loan but the lower up front cost, reduced underwriting requirements, manageable prepayments and more flexible terms outweighed the difference in interest rates. 

The new mobile home park loan replaced the existing loan and recaptured the cost of adding the new spaces and homes. This loan gave the owner a stable fixed low interest rate loan over the next ten years without facing a large prepayment or lockout period for ten years synonymous with the conduit loans.  MHRV Advisors was also able to negotiate a waiver of the prepayment penalty on the existing loan and a earn out for the next 18 months.  The terms of the earn out allow additional loan dollars to be funded under the original rate and terms as the new spaces fill and earn income to supporting the debt coverage ratio and the increase loan to value based on the original underwriting terms.

 

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