Cash Flow With Joe

Lonnie Deals are financial boomerangs

by | Jan 23, 2017 | Lonnie Deals | 8 comments

Lonnie Deals are financial boomerangs:


I want to tell you about one of my favorite deal structures: the Lonnie Deal. That’s when an investor buys a mobile home on a rented lot for cash and resells it, offering owner financing to the buyer.


The reason I love them so much is they fit into any investor’s portfolio at any experience level. They work especially well for beginning investors.


If you’re a beginner, there’s a high likelihood you don’t have a tremendous amount of money to invest. It’s just as likely you have very little experience with things like paperwork and managing property.


With Lonnie Deals, these things aren’t problematic. First, these deals cost very little to get into. The most expensive one we’ve ever purchased cost $5,000.  We average around $2,500 on the purchase price, which is a pretty affordable investment.


Lonnie Deals are also easy in terms of paperwork; there’s only three pieces.


The first is a Mobile home titlebill of sale. You need this when you buy the property or if you sell it for cash. If you need an example of what a bill of sale looks like, Google “DMV bill of sale form.”

Second, you need the title to the mobile home. My suggestion that you look for a DMV (Department of Motor Vehicle) bill of sale wasn’t random. Mobile homes are literally t
railers. They have tires, axles, tongues, and they even have odometer. And since they are mobile, they are governed by the DMV. As such, each one will have a title – just like a car.


agreement for title


The last piece of paperwork you’ll need is called an agreement for title and possession. This is an installment contract that details how your new buyer will pay you, how long they will pay you and what will happen if they don’t. It ends by saying that once they’ve made their final payment, you will give them the title to the mobile home.


So Lonnie Deals are cheap to get into, and they have relatively easy paperwork, but they also give a new investor the opportunity to practice the art of screening while searching for a new buyer. That last part is huge. Being able to find good people who will stay in your homes, pay on time and be good to work with is essential for being a successful investor. With Lonnie Deals, you get learn this skill without the pressure of a mortgage payment looming over you like in a traditional rental.


The best thing about Lonnie Deals, though, is they’re financial boomerangs – by that I mean you often time get them back.


This month we got three different homes back. Now, in other situations it would be easy to freak out – you’d be thinking about the fact that you now have three extra mortgage payments to make with no tenant in the homes.


On the contrary, we get excited when Lonnie Deals come back to us. That’s because we get to sell them again. This starts the payclock all over, and we get a new down payment. Cha Ching!


Boomerange money


The reason Lonnie Deals come back so often is that peoples circumstances change. Take the three houses I just mentioned. Two of the owners got new jobs: one is Savannah and the other in Florida. The third owner was combining households to save up money to by a bricks-and-sticks house.


We’ve owned that last house three times now. Originally, we bought it for $3,500 and sold it for $10,000 cash in less than a month. Not too bad, huh? Later we acquired the same trailer for $2,500. We’re still $4,000 in the clear. We sold it with owner financing 10 months ago for $700 down with payments of $300 a month for three-and-a-half years. We’re about to start that process all over again, which is what makes Lonnie Deals financial boomerangs.


Joe and Ashley English buy houses and mobile homes in Northwest Georgia. For more information or to ask a question, go to or call Joe at 678-986-6813.

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