By ANNE LINDBERG, Times Staff Writer
Published October 7, 2007

Nothing defines the American dream like owning your own home. But in the past few years, thousands of mobile home owners across the state have lost their homes as developers devoured the parks where they lived. Those homeowners found out a hard truth — owning your home is not enough, you also need to own the land beneath it.

That truth has slapped many Pinellas County residents in the face as one mobile home park after another has fallen to developers. Seminole’s Bay Pines and the Golden Lantern in unincorporated Pinellas County on the edge of Pinellas Park are prime examples.

But there doesn’t have to be a sad ending to this story. More and more mobile home owners across the state — despite their often advanced years and fixed incomes — are finding ways to buy their own parks and stay in their homes.

In the Bay Pines and Golden Lantern cases, the folks who owned their mobile homes wanted a chance to buy the park. But they had no such right under state law, which says that owner-occupiers have to be given first chance to buy their park if the sale was solicited by the park owner. If the offer to buy is unsolicited, state law says the landowner does not have to give the mobile home owners a chance to buy the park.

The offers for the Golden Lantern and Bay Pines were unsolicited. So was the offer on the Harbor Lights Mobile Home Park, just down the street from the Bay Pines park.

But the situation is playing out a little differently for the Harbor Lights owner-occupiers. The father of the park’s buyer, John Loder, persuaded his son to give the mobile home owners a chance to buy the park.

Loder’s price: $24.5-million.

The 270 or so mobile home owners in the park will probably have until the first or second week in December to decide whether they can take advantage of the offer, said Marty Pozgay of Florida Community Services Group in Treasure Island. Florida Community Services offers consulting services to mobile home owners who want to purchase their parks. Pozgay helps them find financing and walks them through the process.

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The trend of mobile home owners buying their parks began in the late 1980s and early 1990s as a way to deal with escalating rents. Now there are at least 600 parks across the state that are resident-owned, according to the company’s Web site.

The idea of a bunch of retirees, some of whom are in their 80s or older and many of whom are on fixed incomes, going millions of dollars into debt might seem to be a hard sell to lenders, especially in today’s collapsing real estate market.

But Pozgay said that’s not the case. Lenders, he said, are very willing to consider financing these deals. “The lenders look at this as a very good mortgage for them. There’s never been a co-op in the state of Florida that has failed,” Pozgay said.

He added, “The lenders that we do deal with are typically local lenders, banks that you are familiar with, and most of these folks do have extremely good credit. They usually are very qualified buyers.”

Wachovia Bank is one lender that provides financing for park purchases by residents as well as by developers, said Kathy Harrison, a bank spokeswoman. And Wachovia is eager to consider financing such deals for homeowners.

“Actually, my senior level bankers tell me most banks are very active in this kind of banking … there are very competitive rates out there,” Harrison said.

Many times, the owners are retirees and the fact that they live in the park gives them a stake in making sure the mortgage is paid, she said. In deciding whether to finance such a deal, Harrison said the bank looks at many factors, including the condition of the park and how many homeowners participate in the park ownership. Wachovia, she said, likes to see at least half the homeowners on board.

And the current financial climate has little effect on these deals, she said. “Those loans are available, and they can be very competitive,” Harrison said.

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Here’s one way it can work.

The homeowners form a not-for-profit cooperative, or corporation, which actually buys the park. The bank would lend about 75 percent of the purchase price to the co-op. The bank would hold a “master mortgage” on the property.

The homeowners who also want to be park owners would become co-op members by buying shares. Each share essentially gives the holder possession of one of the lots. The share can be sold or given away or willed to the owner’s heirs, just like a regular deed to a house. The cost of the share would be determined by the actual amount of the 25 percent that was not financed under the master mortgage, and by the number of people who bought in. The more owners who want a share, the lower the cost.

The shareholders never pay rent again, but would pay a maintenance fee to the co-op. The fee goes to maintain the park and pay off the master mortgage.

The shareholder might have enough money to buy the share outright or might have to find a lender to help him make the purchase. If the shareholder defaults, the lender gets the share, which can be sold to someone else.

Mobile home owners or other park residents who do not want to become park owners can stay in the park as renters. The rent would go to the co-op and also would be used to pay off the mortgage or maintain and improve the park.

Pozgay said he’s talking to lenders now.

If all goes well, he plans to meet with Harbor Lights residents at the end of this month to explain the costs and procedures of park ownership.

When he goes to the park, he’ll have lenders with him who are willing to talk to individual homeowners about financing shares.

They won’t even have to leave the park, he said.

Mike Rizzo, head of the Harbor Lights Homeowners Association, who, with his board, has spearheaded the drive to park ownership, declined to comment except to say, “I hope we are successful.”

Fast facts: Here’s the deal

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How mobile home owners can purchase the land under their parks:

  • Get a mortgage: Mobile home owners who wish to buy the park where they live form a not-for-profit cooperative. A bank, or other lender, provides a “master mortgage” that covers approximately 75 percent of the price the co-op agrees to pay for the land. The lender holds the mortgage on the land.
  • Sell shares: The other 25 percent of the purchase price is raised by selling shares to mobile home owners who wish to join the cooperative. The cost of the share is determined by the total amount needed and the number of homeowners who join the cooperative. The share can be bought, sold or handed down to the holder’s heirs. Homeowners who do not have enough money to pay for the shares can borrow from a bank or other lender. In case of default, the lender gets the share, which can then be sold to someone else.
  • Rent helps, too: Mobile home owners who do not wish to join the cooperative can remain in the park. Their rent will go to the cooperative to be used for paying back the mortgage and maintenance on the park.

[Last modified October 6, 2007, 23:17:39]