Mobile Home Park Due Diligence Checklist

Revenue and collections truth 0/6

Park financials are usually owner-operated books, not audited statements. Start where the truth lives: the bank.

• Tie the rent roll to actual bank deposits

  Brokers underwrite the rent roll; banks record what actually happened. The spread between scheduled rent and deposited cash is the fastest read on how the park really runs.

  Bad answer looks like:

  Deposits run well below scheduled rent, revenue moves through a personal account, or the seller cannot produce statements at all.

  Verify with:

  Twelve months of bank statements, the trailing twelve month operating statement, and a rent roll certified by the seller.

  Next move:

  Re-underwrite on collected cash, not scheduled rent, and make the gap a written question for the seller.

• Separate lot rent from home rent and note income

  Lot rent, park-owned home rent, and home note payments are three different businesses with different expense loads, different durability, and different treatment from lenders and appraisers.

  Bad answer looks like:

  A single blended site rent number with no per-site breakdown of who owns each home.

  Verify with:

  A rent roll that tags every site: tenant-owned, park-owned rental, or home under a purchase contract or note.

  Next move:

  Value each stream on its own. Blended numbers almost always flatter the deal.

• Pull every home note and rent-credit contract

  Seller-financed home paper can look like lot rent on the books while carrying consumer-finance compliance exposure if it was originated informally. Federal rules (Dodd-Frank, the SAFE Act) can apply to manufactured-home financing depending on how and how often the seller originated, the exemptions are narrow and conditional, and state rules on chattel lending vary on top of that.

  Bad answer looks like:

  Handshake rent-to-own arrangements, missing contracts, or a seller who shrugs at how the paperwork was done.

  Verify with:

  The full contract file and payment history for every home under any form of buyer financing.

  Next move:

  Have counsel review origination before you inherit it, and price the paper separately from the real estate.

• Confirm utility billing income is durable

  Water, sewer, and trash pass-throughs are real income only if the leases allow them and local rules permit them. Submetering and resale rules vary by state and utility.

  Bad answer looks like:

  Reimbursement income with no supporting lease clause, or billing practices a regulator or a resident attorney would unwind.

  Verify with:

  Lease language site by site, actual utility bills, and the state and local rules for submetering and utility resale.

  Next move:

  Model utilities as an owner cost wherever the pass-through is shaky, and price the fix (meters, lease updates) into the deal.

• Get the delinquency aging, not just the occupancy number

  A full park that does not pay is not full. Collections quality tells you about the tenant base, the management, and how much of the rent roll is real.

  Bad answer looks like:

  No aging report exists, or the answer is that everybody catches up eventually.

  Verify with:

  Accounts receivable aging, eviction filing history, and write-off history for the trailing two years.

  Next move:

  Underwrite economic occupancy, the sites that actually pay, and treat chronic delinquency as management work you are buying.

• Hunt for side deals and off-roll arrangements

  Free lots for the manager, family rates, a site traded for mowing: every park has a few, and they surface after closing as revenue you never actually owned.

  Bad answer looks like:

  Rent roll rates that residents, when asked, do not recognize.

  Verify with:

  A lease audit against the rent roll, plus a direct conversation with the onsite manager.

  Next move:

  Normalize revenue to what is documented and collectible, and put anything that survives in writing.

Occupancy quality and the home mix 0/5

Occupancy in a park is a physical fact you can count. Count it.

• Walk the park and count occupancy yourself

  Sellers count sites generously: storage homes, abandoned homes, and RVs can all get counted as occupied. The occupancy number drives the whole valuation, so it deserves an afternoon of your time.

  Bad answer looks like:

  The rent roll count does not match what you can see: skirted homes with no meter activity, boarded windows, empty pads counted as leased.

  Verify with:

  A lot-by-lot walk with the rent roll in hand, meter readings if the utility will share them, and an evening drive-through counting lights and cars.

  Next move:

  Underwrite the count you verified, and get the difference explained in writing.

• Inventory park-owned homes honestly

  Park-owned homes are an operating business bolted onto your land lease: turnover, rehab, collections loss, and depreciation live there. A POH-heavy park is a different deal than a tenant-owned community at the same headline occupancy.

  Bad answer looks like:

  The seller cannot say which homes the park owns, their age and condition, or what a turn actually costs them.

  Verify with:

  A home-by-home inventory with year, size, condition, and rental status, tied to titles.

  Next move:

  Underwrite POH income with its real expense load, and decide upfront whether your plan is selling homes off or operating them.

• Match a title to every park-owned home

  Manufactured homes are titled like vehicles in most states. A home with no title, a lost title, or a lien from two owners ago cannot be cleanly sold or financed, which blocks the standard exit of converting rentals to owner-occupants.

  Bad answer looks like:

  A shoebox of partial paperwork and a promise that titles will convey at close.

  Verify with:

  The title for every park-owned home, VINs matched to the actual homes, through your state's titling agency (the DMV or the housing department, depending on the state).

  Next move:

  Make clean, matched titles a closing condition with holdback teeth.

• Price out abandoned and dead homes

  A dead home is not a vacant site. It costs real money and legal process to gain possession, remove it, and prep the pad before the site can earn again.

  Bad answer looks like:

  Several obviously dead homes waved off as easy infill.

  Verify with:

  Your own walk, plus the state's abandoned-home process and its timeline. It runs through a legal process, not a dumpster.

  Next move:

  Budget removal and the legal timeline per home, and subtract that from the infill story.

• Map the tenant base to the employers behind it

  Resident stability is the asset, and it is only as durable as the paychecks behind it. An all-age park spread across many employers behaves differently from a 55-plus community, and both behave differently from a park that empties out when one plant, one mine, or one season does.

  Bad answer looks like:

  High turnover on lot tenants, or a park where the manager can name the single employer most residents depend on.

  Verify with:

  Tenure data from the rent roll, a direct conversation with the manager about where residents work, and county employment data for the employer mix.

  Next move:

  Stress the deal for the tenant base you actually have. Single-employer exposure is a pricing input, not a footnote.

Utility systems 0/6

Utilities kill more park deals than any other category. Find out what you are really buying: city services, or a small utility company with homes around it.

• Establish who owns and operates every utility

  City water and city sewer, direct-billed, is one business. Park-owned wells, septic, or a treatment plant is a different business with licensing, testing, and replacement risk that becomes yours the day you close.

  Bad answer looks like:

  The seller is vague about where the park's systems end and the city's begin, or resells utilities without understanding the obligations that come with it.

  Verify with:

  Utility bills, the utility providers themselves, and any state filings for park-operated systems.

  Next move:

  If the park is the utility, diligence it like one: permits, licensed operators, compliance history, and end-of-life cost.

• Diligence private wells like the regulated systems they are

  A park on its own wells is usually a regulated public water system, with testing schedules, operator requirements, and a public compliance record.

  Bad answer looks like:

  Missing sampling records, past violations nobody mentions, or an unlicensed well guy on call.

  Verify with:

  The state drinking-water program's compliance record for the system, its permits, and the full testing history.

  Next move:

  Any violation history goes to a water professional for a real assessment before you price the deal.

• Treat septic, lagoons, and package plants as the main event

  Wastewater is the classic park deal-killer. Failing drain fields, out-of-compliance lagoons, and aging package plants can cost enough to reprice the entire deal, and they come with regulators attached.

  Bad answer looks like:

  No permits or inspection records, effluent surfacing anywhere in the park, or a consent order the seller forgot to mention.

  Verify with:

  Discharge permits, inspection and pumping records, the regulator's own file on the system (request it), and a specialist inspection with a capacity assessment.

  Next move:

  Get the regulator's file and a specialist opinion before waiving contingencies. Walk away from a system on borrowed time you cannot price.

• Age the buried lines before they age you

  Original water and sewer runs in older parks, galvanized water lines and clay or Orangeburg sewer, fail from the ground up. The first symptom is usually a water bill that grows while occupancy does not.

  Bad answer looks like:

  Water expense trending up against flat occupancy, chronic leak repairs in the maintenance history, and no map of the underground systems.

  Verify with:

  Two to three years of utility bills read against occupancy, maintenance logs, a camera inspection of the sewer mains, and whatever as-built drawings exist.

  Next move:

  Price partial replacement into your capital plan, and negotiate with the evidence.

• Check electrical service against modern homes

  Many older parks carry pedestal service sized for the homes of their era (50 or 60 amp is common), and modern homes generally expect substantially more. Undersized pedestals quietly cap your infill and home-replacement plans until an electrician and the power company get involved.

  Bad answer looks like:

  A park pitched on infill upside where the pedestals cannot serve the homes you would bring in.

  Verify with:

  A licensed electrician's read on pedestal amperage, panel condition, and what an upgrade actually involves locally.

  Next move:

  Fold electrical reality into the infill math before you pay for the upside.

• Flag master-metered gas and central propane

  A park that resells gas or runs a central propane system carries safety obligations, inspection duties, and liability that direct-billed parks never have to think about.

  Bad answer looks like:

  A central system with no inspection records and nobody clearly responsible for it.

  Verify with:

  The system type, its inspection history, and the state's rules for gas resale and operator duties.

  Next move:

  Get a qualified inspection, and decide whether converting to direct service belongs in your plan.

Ground, roads, and drainage 0/5

Everything above ground is easier to see. You just have to look with the right questions.

• Settle who owns the roads and what they need

  Private roads are yours: paving, potholes, snow, and liability. Public roads shift the cost away but constrain control. Road replacement is one of the largest above-ground capital items in a park.

  Bad answer looks like:

  Failing asphalt on private roads treated as cosmetic, or nobody actually knowing whether the roads were ever dedicated.

  Verify with:

  County records for dedication, plus a paving contractor's assessment rather than a windshield glance.

  Next move:

  Capital-plan the roads honestly. They do not heal.

• Map drainage and flood exposure

  Low sites that flood do not stay rented, and floodplain locations change insurance, financing, and what you are allowed to rebuild after a loss.

  Bad answer looks like:

  Standing-water marks, culverts full of sediment, and residents who can tell you exactly which sites go under in a hard rain.

  Verify with:

  FEMA flood maps for the parcel, a walk timed after rain if you can manage it, and the residents themselves.

  Next move:

  Underwrite chronically wet sites as what they are, and get flood insurance quotes before close, not after.

• Treat mature trees as a capital item and an insurance input

  Big trees over old homes generate claims, and claims drive premiums and insurability. Roots also heave pads and invade the same aging sewer lines you just camera-tested, so the tree problem and the buried-line problem compound each other.

  Bad answer looks like:

  A canopy of aging trees, tree claims in the loss runs, and no trimming history anyone can produce.

  Verify with:

  Insurance loss runs read specifically for tree perils, maintenance records, and a tree service walk-through on the worst offenders.

  Next move:

  Budget a real tree program in year one, and raise it with your insurance broker before binding, not after the first storm.

• Test the vacant lots against the homes people buy now

  Many older parks were laid out for home sizes that no longer exist. If today's homes physically do not fit the vacant lots, the vacant-site upside is smaller than the site count suggests.

  Bad answer looks like:

  Infill upside priced on lots that cannot take a modern single-wide without violating setbacks or spacing rules.

  Verify with:

  Measure representative vacant lots against current home dimensions and the spacing rules in the ordinance or the park's approval.

  Next move:

  Count only the lots a real home can occupy legally.

• Audit amenities as liability and code exposure first

  Pools and playgrounds are the two amenities insurers and code officials care most about: a pool can carry health-department permits, fencing and safety code, and a visible line on your premium. Amenity and community rules also touch fair-housing law (age-restricted versus all-age operations have different obligations), which is counsel territory, not guesswork.

  Bad answer looks like:

  A closed pool you could supposedly reopen, with no read on permits, code, insurance treatment, or actual resident demand.

  Verify with:

  The insurance treatment of each amenity, the permit and code requirements to operate or reopen it, and what residents actually use today.

  Next move:

  Decide amenity by amenity: operate it properly, or retire it properly. Reopening is a project with permits, not a weekend cleanup.

The legal right to operate 0/6

A park's most valuable asset is often a piece of paper from decades ago. Verify that it exists, and that it survives the sale.

• Verify the permit to operate, and its site count

  In most jurisdictions a park operates under a permit or license, often with a specific site count. Sites occupied beyond the licensed count may not be legal sites, and some licenses do not transfer automatically on sale.

  Bad answer looks like:

  The seller cannot produce the license, the licensed count is lower than the occupied count, or the transfer requires an inspection the park would fail.

  Verify with:

  The licensing agency's records (often the state or county health department), the license document itself, and the transfer rules.

  Next move:

  Make transfer of the license, at the full site count, a closing condition.

• Read the actual grandfathering rules, not the summary

  Most older parks exist as legal nonconforming uses: the zoning changed around them. The protection is real but conditional, and the conditions (abandonment windows, damage-rebuild thresholds, expansion bans) decide what happens after a fire, a long vacancy, or your expansion plan.

  Bad answer looks like:

  A zoning letter that says legal nonconforming, with nobody having read what actually terminates the protection.

  Verify with:

  A zoning verification letter plus the ordinance text itself, read by you or your counsel, with particular attention to abandonment and reconstruction clauses.

  Next move:

  Price the deal on what the ordinance lets you rebuild, not on what happens to be standing there today.

• Check rent regulation where the park actually sits

  Several states and a growing list of local jurisdictions regulate manufactured-home lot rents specifically, and the rules change. Your rent-growth assumption is a legal question before it is a market one.

  Bad answer looks like:

  An underwriting model with rent increases the local rules would not allow.

  Verify with:

  Current state statutes and local ordinances for the exact jurisdiction, plus anything pending. Council agendas are public, and counsel can confirm how the rules apply to your park.

  Next move:

  Underwrite inside the rules as written, and know the local politics before you buy the exposure.

• Reconcile the site count against the approvals

  Sites get added over decades without paperwork. If twelve sites exist beyond the approved plan, you may be buying twelve sites of enforcement risk rather than twelve sites of income.

  Bad answer looks like:

  The approved plan, the license, and the physical count all disagree with each other.

  Verify with:

  The approved site plan on file with the jurisdiction, against your own lot-by-lot walk.

  Next move:

  Get the discrepancy resolved or priced before close.

• Take the town's temperature

  Parks live with local politics more than most assets. A jurisdiction that wants the land redeveloped shows its hand in code enforcement patterns, moratoriums, and planning overlays.

  Bad answer looks like:

  A thick code-violation file, a comprehensive plan that maps your park as future something-else, or council minutes discussing the site.

  Verify with:

  Code enforcement history (public record), the comprehensive plan, and recent council minutes that mention the park.

  Next move:

  A hostile jurisdiction is a risk you price. A neutral one is normal. A supportive one is worth paying for.

• Check resident and state notice rights early

  A number of states require advance notice to residents, and sometimes to a state agency, before a park sells. Some give residents or nonprofits an opportunity to make an offer. Missing a notice requirement can delay or unwind a closing.

  Bad answer looks like:

  Neither the seller nor the broker can say what the state's park-sale notice law requires.

  Verify with:

  The state's manufactured-housing statutes on park sales, reviewed with counsel.

  Next move:

  Build the notice timeline into the contract from day one.

Title, survey, and environmental 0/4

• Read the title exceptions like they will bite

  Parks accumulate easements, old operating agreements, mineral reservations, and repurchase rights over the decades. Any of them can constrain operations or financing.

  Bad answer looks like:

  Schedule B exceptions nobody has read, or an easement that turns out to run under half the sites.

  Verify with:

  The full title commitment with the exception documents themselves, reviewed by title counsel.

  Next move:

  Clear it, endorse around it, or price it. Never ignore it.

• Get a survey that shows the homes

  Homes drift over boundaries, into setbacks, and onto easements. A boundary survey that ignores home placement misses the point of a land-lease business.

  Bad answer looks like:

  Homes over the property line, sites straddling an easement, or no survey at all.

  Verify with:

  An ALTA survey, or the best local equivalent, showing home footprints against boundaries, setbacks, and easements.

  Next move:

  Encroachments become title endorsements, resolutions, or price adjustments before close.

• Run the Phase I with park-specific eyes

  Rural land keeps secrets: an old dump in the back acreage, buried tanks from a defunct fuel pump, a former dry cleaner on the commercial frontage. Environmental liability attaches to owners, and lenders will not look away.

  Bad answer looks like:

  Recognized environmental conditions the seller talks past, or visible staining and fill areas with no explanation.

  Verify with:

  A current Phase I environmental site assessment from a firm that has worked manufactured-housing sites, with the historic aerials actually reviewed.

  Next move:

  Any recognized condition goes to a Phase II or to renegotiation. Environmental surprises do not improve with ownership.

• Confirm the flood zone determination in writing

  Flood status drives insurance cost, lender requirements, and rebuild rules. It is cheap to confirm and expensive to assume.

  Bad answer looks like:

  The listing says no flood issues while FEMA's map says otherwise.

  Verify with:

  The FEMA flood map panel for the parcel and a written flood determination.

  Next move:

  Get insurance quotes for the real zone before your contingency expires.

Operating truth 0/5

Most parks are sold on books that quietly assume the owner works for free.

• Find the expenses that are not on the books

  Owner-operated parks often show no payroll, no management cost, and no reserves, because the seller mowed the grass, fixed the leaks, and answered the phone. You will pay someone to do all of it.

  Bad answer looks like:

  An expense load with obvious jobs missing. Who mows? Who fixes? Who collects? Who answers at 2 a.m.?

  Verify with:

  Rebuild the expense stack from the physical reality of the park (its systems, size, and staffing needs) rather than from the seller's statement.

  Next move:

  Underwrite the park as you will actually run it. The seller's books describe their life, not yours.

• Get the manager arrangement in writing

  A free lot, a cash stipend, and undocumented duties is the standard park manager package. It is a real expense and a key-person risk hiding off the books.

  Bad answer looks like:

  A long-tenured manager, compensated informally, holding all the operational knowledge and none of it written down.

  Verify with:

  Whatever writing exists, plus a direct conversation about duties, compensation, and their intentions after the sale.

  Next move:

  Cost the role properly, and plan for both outcomes: keeping them well, or replacing them cleanly.

• Demand the capital history with invoices

  What was replaced, when, and by whom tells you what comes next. A park with no invoice trail has no memory, and you inherit the amnesia.

  Bad answer looks like:

  Claims of all-new water lines or freshly redone roads with no paper behind them.

  Verify with:

  Invoices, permits pulled, and contractor names you can actually call.

  Next move:

  Anything unproven gets treated as original equipment in your capital plan.

• Pull the loss runs

  Five years of insurance claims tells you what the property actually does: trees on homes, slip-and-falls, storm patterns. Insurers will price your future off this record, so you should too.

  Bad answer looks like:

  Repeated similar claims, the same peril in the same corner of the park, or a liability claim pattern.

  Verify with:

  Carrier loss runs for five years, requested through the seller's insurance broker.

  Next move:

  Get your own binding quotes early. Insurance surprises have repriced entire markets.

• Model your property taxes, not the seller's

  In many jurisdictions the sale triggers reassessment, and the tax line in the seller's books dies at closing. This is one of the most common quiet mistakes in park underwriting.

  Bad answer looks like:

  An underwriting model that carries the seller's assessed value forward untouched.

  Verify with:

  The county assessor's reassessment practice for sales (call and ask), and post-sale assessments on comparable properties where available.

  Next move:

  Run your pro forma on the tax bill your purchase price creates.

Financing and exit 0/3

• Know where the park stands with agency lenders

  Fannie Mae and Freddie Mac manufactured-housing programs set standards along dimensions like minimum community size, site quality ratings, infrastructure, the share of park-owned homes, and tenant site lease protections, and the specifics change with program updates. Whether your park can meet them shapes your refinance path and, just as importantly, who can buy it from you later.

  Bad answer looks like:

  A park that structurally cannot meet agency standards being priced as if it could.

  Verify with:

  The current program requirements read against the park's honest profile, with a lender who actually closes manufactured-housing deals this year.

  Next move:

  If agency debt is out of reach, underwrite with the debt you can really get, at its real terms.

• Read the existing debt before you plan around it

  Prepayment penalties, yield maintenance, assumption rights, and escrow terms on the seller's loan can constrain the entire transaction structure.

  Bad answer looks like:

  A deal timeline that ignores a yield-maintenance penalty or an assumption approval process measured in months.

  Verify with:

  The actual note and loan agreement, not the seller's memory of them.

  Next move:

  Structure the purchase around the debt reality, or price the cost of removing it.

• Verify the park is insurable at a price you can carry

  Older homes, private infrastructure, pools, and certain regions have made park insurance genuinely difficult in recent years. Coverage you assumed can be the last surprise before closing.

  Bad answer looks like:

  One quote, arriving late, with exclusions nobody read.

  Verify with:

  Multiple binding-level quotes, with the loss runs disclosed, before contingencies expire.

  Next move:

  If insurance is thin, that is a pricing conversation, not a closing-week discovery.

Market reality and infill 0/4

The infill story sells parks. Check whether it survives arithmetic and a phone.

• Do the full infill math

  Filling a vacant lot means acquiring a home, transporting and setting it, connecting utilities, and finding a qualified buyer or renter. Every step has a real local cost and timeline, and the pitch usually includes none of them.

  Bad answer looks like:

  Upside priced as if vacant lots become paying lots by themselves.

  Verify with:

  Real quotes in this market: a home delivered and set, utility connections, and a realistic sell or lease timeline. Use your own local numbers; anyone quoting a universal figure is guessing.

  Next move:

  Underwrite infill as a project with capital and a timeline, or exclude it and treat it as pure upside.

• Test the local used-home market

  Infill and park-owned home exits both depend on whether homes actually sell here, and how fast. Listings and time-on-market are checkable facts, not opinions.

  Bad answer looks like:

  No used homes moving within a sensible radius, or a market where every sale is a repossession at scrap value.

  Verify with:

  Current local listings, recent sales you can find, and conversations with the dealers who serve the area.

  Next move:

  Let the evidence size the infill story.

• Shop the competition yourself

  Nearby parks' actual lot rents, availability, and condition set your ceiling more than any national narrative. This is an afternoon of calls and drive-bys.

  Bad answer looks like:

  Competitors with vacancies, lower lot rent, and better infrastructure than the deal you are pricing.

  Verify with:

  Call every park within commuting distance as a prospective resident, and drive the closest ones.

  Next move:

  Position your rents and upgrades against what residents can actually choose instead.

• Run a live demand test before you close

  A test listing, a lot-for-rent or home-for-sale ad in the channels local residents actually use, measures demand directly while your contingencies are still alive.

  Bad answer looks like:

  A week of silence on a well-placed test ad for the exact product you plan to add.

  Verify with:

  The responses to your own test listing: volume, quality, and what callers ask for.

  Next move:

  Let real inquiries calibrate the lease-up pace in your model.