Notes Receivable

3 Months Ended

Mar. 31, 2014

Notes Receivable

Notes Receivable

Occasionally, we make loans to finance the sale of homes to our customers or purchase loans made by others to finance the sale of homes to our customers (“Chattel Loans”). The Chattel Loans receivable require monthly principal and interest payments and are collateralized by homes at certain of the Properties. As of March 31, 2014 and December 31, 2013, we had approximately $21.3 million and $21.9 million, respectively, of these Chattel Loans included in notes receivable. As of March 31, 2014, the Chattel Loans receivable had a stated per annum average rate of approximately 7.8%, with a yield of 19.6%, and had an average term remaining of approximately 12 years. These Chattel Loans are recorded net of allowances of approximately $0.4 million as of March 31, 2014 and December 31, 2013.

We also provide financing for nonrefundable sales of new or upgrades to existing right to use contracts (“Contracts Receivable”). As of March 31, 2014 and December 31, 2013, we had approximately $17.1 million and $17.2 million, respectively, of Contracts Receivable, net of allowances of approximately $0.3 million and $0.6 million, respectively. These Contracts Receivable represent loans to customers who have entered into right-to-use contracts. The Contracts Receivable yield interest at a stated per annum average rate of 16%, have a weighted average term remaining of approximately four years and require monthly payments of principal and interest.