Mobile homes aren’t too mobile and create financial risk

John Oliver’s “Last Week Tonight” may have a comedic bent, but is one of the best news shows around. The latest episode included a detailed look at the mobile home industry. The key takeaway is private investor groups prey upon the mobile (and modular) home buyers through a rigged system.

Between a truly captive audience (more on this later), the fact the significant majority of mobile home buyers rent the land underneath, and the predatory lending and sales practices, the buyers are at the mercy of greedy players in a shady industry. Adding to that, the value of the mobile home will only depreciate (like an auto), so the buyer truly must beware.

We have come to this problem as several conditions have culminated together. We have an increasing number of “have-nots” in America, so mobile or modular homes are the most affordable route. The mobile home park owners have consolidated and were purchased by several private investor groups, but even the larger regional players operate under this rigged system. These folks see a market to squeeze. Finally, if the buyers do not own the land, they are truly held hostage.

Why? Over 80% of mobile homes never move due to the cost of moving. The property owners know this, so they annually jack up the rent increasing by exorbitant amounts. The renters are then inundated by collection agencies who get them to pay. When they cannot, they eventually move, leaving their home behind. Then, the property owner takes possession of the abandoned home and rents it out.

Finally, the sellers of these products often own the financing agency offering a turn-key purchase. The loans are more like predatory car loans than they are mortgages. So, the interest is higher than normal at the same time the rent is getting increased.

Oliver’s show highlights a couple of the players in the industry. One property owner has sites in 25 states and offers seminars on how to gouge your captive tenants. In one instance, this property owner referred to his tenants as “like being chained to a Waffle House table.”

There is a small movement afoot which will allow homeowners to buy the mobile home park land en masse, as a right of first refusal. Nonprofit funders are helping make this happen. What is needed is more states to have right of first refusal laws, so that the property is not sold to a predatory landlord.

The other need is education. If you must buy a mobile or modular home, place it on land you own or in a tenant owned development. Also, seek better financing than what is offered by the seller. But, know going in this home will not go up in value. If you buy a modular home for $50,000, it may be only worth $10,000 in a few years.

The “have-nots” have little recourse in this industry. Education is a must, as you will truly become a hostage in your home.

 

 

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Hey Dems, focus on these four issues

One of this Independent voter’s frustrations with politics, which is exacerbated by this President, is pressing issues are not getting discussed. And, some are made worse or are sabotaged by the current White House incumbent as we are told to focus our attention on issues he has overstated in importance or sold on fear.

While there are many issues, it is hard to boil the ocean. So, my advice to all politicians, but especially the Democrats who are pushing these ideas, is to narrow the focus to the following four issues.

– Stabilize the healthcare system and have a good debate on Medicare for All, which is a hard sell. The GOP has failed to realize that a reason they lost the House is not listening to most Americans, instead sabotaging the ACA reneging on commitments to insurers and trying to repeal it. As a retired benefits actuary, consultant and manager. I would suggest an idea to stabilize the ACA is to expand Medicare to retirees at age 60 or 62 and measure the impact for its veracity. But, we need to start by paying insurers what we committed to them.

– Climate change is real, is happening and is man-influenced. AOC is dramatizing a little about the end of the world, but the data point she is citing is if we do not make huge strides by 2030 (12 years), our ability to stop the warming trend impact is minimal. She has been ridiculed for he Green New Deal by the GOP, but I would rather discuss her plan than Senator Marco Rubio ignoring the fact the largest city in Florida is the most at risk city on the planet and is seeing a larger number of sunny days flooding from the rising tides. Who is the crazier person, the one speaking to a problem or the one ignoring it altogether?

– Job retraining is key, but we need to understand the major reasons the jobs are going away are technology/ robotics and CEOs chasing cheap labor. It is not immigration or trade, which are down the list. This especially true in those impoverished areas where industry has left them behind moving or closing a plant.

– Finally, the debt and deficit are critical to discuss. The debt just passed $22 trillion and is headed to $34 trillion by the end of 2027. The annual deficit will pass $1 trillion this year, which is nearly 1/3 of our annual revenue. My former party and, in particular, the Freedom Caucus, are as hypocritical as they come. When the Dems had the White House, the Freedom Caucus screamed bloody murder when the debt was $8 trillion, then $13 trillion. But, I give the same caution to Dems I give to the GOP, we must reduce spending and increase revenue. The math will not work otherwise, so says the CBO, Committee for a Responsible Federal Budget, The Concord Coalition and Simpson-Bowles Deficit Reduction Committee.

Of course, there are other critical issues. But, if you focus on the important few, it will resonate. This is especially true for younger folks – climate change, debt, future jobs and healthcare are important. In my view, the GOP has lost its way on issues of import. When I left the party twelve years ago, a key reason was its global warming denying stance. My thesis is if you are denying the greatest threat facing our planet, how can I trust you on resolving other issues?

We are behind the eight ball on too many issues. We are leaving our problems to our children and grandchildren. They will ask us, why did you do that? Why, indeed?

This, that and another thing

Now that the state of the union and Democrat rebuttal are behind us, it would be nice if an independent voter had a turn. On the talk (and some shouting) shows, the independent views do not get heard enough and that is disappointing. For once, it would be illuminating for a member of neither party to share their thoughts.

For example, we might learn:

  • Global warming really is a concern and we should be doing something about it. On Bill Maher’s Friday show,  he noted that Senator Marco Rubio used the argument against the President for declaring a national emergency to build the wall, as what would stop President Kamala Harris from doing so to address climate change? Maher correctly pointed out the latter is becoming a national emergency, while the wall is not even a top ten issue and is overblown as a solution. He also noted, with the very real concerns over Miami, Rubio may become the Senator of Atlantis.
  •  A growing debt which is around $22 trillion with an annual deficit about to hit $1 trillion is a problem, especially with the deficit in a good economy. The Committee for a Responsible Federal Budget models the debt to be around $34 trillion at the end of the 2027 fiscal year. We must have spending cuts and revenue increases both. The math will not otherwise work. If a politician tells you differently, he or she is lying to you. Don’t let them.
  • The Affordable Care Act and Obamacare are the same thing. So is KyNect in Kentucky. Too many people still don’t realize this in the GOP. But, don’t look to politicians to solve this, as they really do not understand how our complex healthcare system works. We need to stabilize the ACA and stop sabotaging it, as the GOP has done.  My recommendation as a retired benefits consultant, actuary and manager is to fund money promised to insurance companies to pay for adverse selection and committed to deductibles, copays for people beneath 2 1/2 times the poverty limit. I would also expand Medicare as a pilot, measured effort to retirees below age 65, such as 60 or 62. This will reduce the cost rate in the exchanges and Medicare. The remaining states need to get off the dime and expand Medicaid – it is a no brainer per GOP Governor John Kasich.
  •  Addressing America’s crumbling infrastructure would help rebuild assets and provide good jobs. We also need to build on the community college system with some added funding to retrain people to do the jobs of the future, as technology claims even more (this is the major threat, not immigration or trade). Also, building on the bipartisan idea pitched to the President last year by Senators Sherrod Brown and Rob Portman from Ohio, we should co-invest with car manufacturers to retool plants to make the cars in demand and keep the factories open. This idea was ignored and the President was offended when GM announced some plant closings.
  •  There are so many more ideas around rethinking ill-conceived tariffs and trade fights, poverty issues, and gun governance, but let me make a general statement that is important. Start treating our allies and citizens with fairness and dignity. Stop the adversarial BS. A country and business makes more money long term by having a productive long term relationship. We need to stop measuring success on short-term transactions. Listen to your advisors as they actually study our problems. And, stop beating up on a free press. From where I sit, they are not perfect, but the true journalists try to get it right. The main source of fake news in the country sits in the oval office and he only cares about looking good.

Well, that is enough for now. I would love to hear your thoughts.

Let’s rise up

A terrific singer named Andra Day provided an anthem for women, but also forward thinking men as well. It is called “I’ll rise up.” Here is the final chorus which says let’s all rise up.

“Rise like the day
I’ll rise up
In spite of the ache
I will rise a thousands times again
And we’ll rise up
Rise like the waves
We’ll rise up
In spite of the ache
We’ll rise up.”

There has been a building crescendo worldwide, but especially here in the US, to say women matter. Women are tired of being taken advantage of by sexual predators, violent and controlling partners and men in power telling them what they can do with their bodies. Women are tired of people ignoring or demeaning them when they complain or accuse a violator. Women are tired of kitchen table issues like equal pay and healthcare gettimg ignored. Women are tired of nothing being done about gun governance which takes to many of their children and themselves.

Women are tired of being kidnapped and trafficked as sex slaves or servants. And, more globally, women need to be supported for saying we are not a possession to be sold, beaten or killed and we need not go through genital mutilation to satisfy an archaic religious practice written by a men.

Now, is the time to rise up. Women are running for political office in tremendous numbers in the US. They are reacting to a misogynist bully who shows what leadership does not look like. Their global sisters are using the opportunity to make a stand.

Rise up and vote. Rise up and take a friend to vote with you. Rise up and make sure your family votes. Rise up and vote for equal rights for all, for our environment which is being destroyed and for our future which is threatened by existential crises like climate change, poverty and inequality. Rise up. It is time to make a huge statement. I am with you.

Thursday thumbnails redux

Since I am kicking around several topics, let me throw a few together for your reading and reaction. Your thoughts are welcomed and appreciated.

  • It would be terribly unfair to say Republicans are racist, but it seems there are more than a few racists running for important offices in various states under the GOP banner. In Virginia, Illinois  and Florida, for example, a few candidates have a history of racist comments and associations. To their credit, the GOP leadership is not backing all of these candidates, but they should not back any and should condemn their words and actions in no uncertain terms. It is disappointing that the US President has done neither and has greased the skids for white supremacist hate groups who now feel empowered. Trump had a truly a low bar to step over to condemn white supremacists last summer and he tripped.
  • Sexual assault is a heinous crime, yet the accuser does not often come forward given the backlash they get. So, for it to take years to come forward is not uncommon. The fact they do so when the accused is being considered for high office, should reveal a greater sense of character. Professor Blasey Ford deserves due consideration and time for her accusations of Supreme Court nominee Brett Kavanaugh. Call me crazy, but we should take the time to get this right as this is one of the nine most important people in our courts. Because we did not take time back in 1991, we may have a man guilty of sexual misconduct on the bench already.
  • I have written before that Democrats are lousy marketers. Even when they have a better story to tell, they often let Republicans define the talking points. The Democrats have many fine candidates running for office. Some are running uphill battles in gerrymandered districts, but they are running well. What should be shouted from the rooftops is they will help improve and stabilize the ACA as it continues to be sabotaged by the GOP making premiums even higher, they will protect our environment against the further roll back of regulations enabling polluting and stay committed to the Paris Climate Change accord, they will make sure we do not devalue our allied relationships and retrench further from our global leadership role, and they will advocate for rights of all citizens, especially those in poverty. And, to be frank, since the GOP has ceded its leadership toward addressing the debt and deficit, the Democrats can be seen as better financial stewards.

Truth be told, the President touts what he has done with the economy, but what he fails to tell people is we are in the 113 consecutive month of economic growth, the bull stock market traces back to March, 2009 and unemployment was low when he took the reins. What has been done, is he is borrowing from our future to make a good economy a little better, but the cost is doing nothing but add fire to our burning debt.

Presidents get too much credit and too much blame for the economy. They do provide headwinds and tailwinds, though, and this President has done both. The headwinds will show up later as noted by most economists, while the tailwinds add today.

Questions for Campaigning Republican Legislators

Our diligent and thorough blogging friend, Gronda, wrote a post regarding answers to questions that Republican Party leadership provided GOP candidates. Most of the questions are of many of the messes the President finds himself in of his making, but truly miss the boat on where Republicans and the President have failed to address larger US and global issues.

There is plenty to ask about of these legislators. Here are a few of my questions:

– why are you allowing the easier maltreatment of our environment by industry?

– why are you supporting leaving the Paris Climate Change Accord ignoring the rest of the world?

– why have you failed to address our water concerns in Flint and similar places?

– why have you not only ignored our rapidly rising and expensive debt, but made it worse?

– why have you stood by and let the President trash and cut our diplomacy staff and bully our allies?

– why are we placing tariffs on everyone, without concern for past failures and ignoring better channels to address China involving our allies?

– why have you not listened to Americans and improve the ACA actually harming it instead?

– why have you not done anything to materially address gun governance?

– why have you allowed a President to trash our hard working people in important government departments to create an illusion of conspiracy to save his hind end?

– why have you tolerated a President who believes the civil rights of whites matter more than that of other races?

– why are we doing things to make our poverty problem worse, not better?

– why have we not addressed infrastructure with our significant needs and resulting job creation when interest rates were lower?

That is a start. These folks have a lot to answer to. To be frank, all Americans should be asking these questions, but if I were a young person, I would be even more alarmed. Just with climate change and growing debt, this party is screwing our youth.

But, there is so much more. I am an Independent voter who left the GOP over ten years ago because of their failure to speak to the truth on real problems – Trump has made it worse and his followers have been conned to believe the opposite.

When you choose not to decide, you still have made a choice

If you have followed this blog for any length of time, you will know that I love cleverly worded song lyrics. The above title comes from an unexpected source (if you don’t follow the band) – a song called “Free will” by the rock band “Rush.” I find this lyric, penned by drummer Neil Peart, compelling as it speaks to people who choose to do nothing in the face of obvious problems. Martin Luther King saved some of his criticism for the silent people who did not condemn Jim Crow actions.

People choose not to vote because they do not like the choices. But, “none of the above” is not an option and one candidate tends to be worse or represents worse. If you did not vote because you did not think Brexit or Trump would win, you water down your right to protest. And, I would add there are seven white supremacists running for office, empowered by a US President who won’t condemn racist actions and has made racist statements. So, your vote does matter.

If you witness a daily assault on civil rights, women’s rights, truth, media, science, allies and environment and don’t speak up, then you condone the actions as acceptable.

– It is not OK for leaders to lie multiple times a day.

– It is not OK to have governmental websites delete data that run afoul of unsubstantiated opinions by leaders.

– It is not OK to demean people because they dare criticize a leader’s point of view.

– It is not OK to demonize groups of people or exaggerate causes of problems, as it is hard enough to solve real problems with real data.

– It is not OK to ignore real problems or have faux efforts to address them. Gun deaths, poverty, health care access and costs, infrastructure deterioration, increasing debt, environmental degradation, climate change, etc. are real problems.

Please do not remain silent. Speak up. Call or email your representatives. Attend marches and protests. Share diplomatically your opinion, but listen to theirs. Find a way to get your opinion heard and heeded. Calling someone a name is not the way to be heard.

The other day as I was looking for a new battery for my cordless mower, a store clerk and I chatted about the need to move toward renewable energy. While he supported the eventual move, he said renewable energy is “seven times” the cost of fossil fuel energy. I responded and said that is a ten-year old argument. The costs are now more on par. In fact, there is a city in Texas who chose to be 100% renewable energy powered as its CPA mayor said financially it is a better deal. Did he hear me? I don’t know, but he would not have  if I had not listened to his argument and responded.

Do not follow the words of the song lyric. Choose to decide.