Posted on: 28th Jun, 2005 04:53 am
If you're looking for a relatively less costly housing option than a traditional home, then one good choice available before you is the mobile or manufactured home. Mobile home, also called as trailer or caravan, is gradually becoming a popular housing option to many home buyers. Though a mobile home may look like a traditional home but it is comparatively little difficult to finance this type of home than to finance a traditional one. With little more effort, however, you can find out the required financing option too. If you want to know about mobile home loans, check out the following topics:
- What are the types of mobile home loans?
- What are the requirements to qualify for mobile home mortgages?
- What are the steps that you need to follow to obtain mobile home financing?
- What tax benefits do mobile home loans offer?
- Top 20 Mobile home loan FAQs
What are the types of mobile home loans?
Finding out the right mobile loan product can save a lot of money for you. Here is an outline of different financing options that may help you select the right product. These loan products are categorized on the basis of land ownership, lending authority and some other factors.
- Personal property loan: If the manufactured property is not on a permanent foundation and if it is purchased separately, then you have to take out a personal property loan. When you own a land on your own, then personal property loans may be required to finance the purchase of a mobile home. In comparison to traditional home financing, the qualifying standards for personal property loans are relatively lenient.
- Mobile home mortgage loan: If the manufactured property that you want to purchase is on a permanent foundation, then you have to take out a mobile home mortgage loan. These loans are relatively difficult to qualify than the personal property loans. These loans also require higher upfront costs than the personal property loans.
- Federal programs: Title I and Title II loans are offered by the lenders approved by the Federal Housing Administration (FHA), to buy mobile homes. To qualify for these FHA-approved loans, mobile homes must conform to the HUD Code and must be located on approved foundations.
Manufactured home loans, guaranteed by the Department of Veteran's Affairs (VA), are available for for the veterans. This 100% VA financing is available if the mobile homes are located on approved foundations. The United States Department of Agriculture (USDA) also offers financing for the purchase of manufactured homes. - State and local housing agency programs: Mobile home loans are offered by the State Housing Finance Authorities/Housing Agencies to the first time home buyers at relatively lower rates.
- Construction loans: These are short term loans designed to help you build a mobile home on property you have already purchased. Short term, high interest construction loans may also be available to help you make improvements on your home or property.
- Home improvement loans: This type of loan is designed to help you make improvements to your mobile home. An example of this type of loan is a Title 1 Home Improvement loan insured by the FHA. Some states offer special loan programs in addition to the Federal government's tax deduction for certain energy efficient improvements. In addition to the options stated above, there are also mobile home refinance and equity loans available from specific lenders. All you need to do is decide why you want to take out the loan and choose the one that is right for you.
On the basis of land ownership:
On the basis of lending authority:
On the basis of other factors:
What are the requirements to qualify for mobile home mortgages?
Usually mortgage loans are not offered for the purchase of manufactured homes which were built before 1976. This is so because the lenders take a close look at the condition of the house before offering a loan. A manufactured home must comply with the building standards proposed by Department of Housing and Urban Development (HUD). Here are the requirements to qualify for a manufactured home loan -
- The HUD Code requirements:
- As per the HUD Code, the home must be built as 1/2/3 section homes at a protected place. Then the home has to be shifted to the site. Thereafter, the wheels and axles must be removed so as to give it a permanent foundation.
- The home should follow the HUD Code pertaining to quality, design, transportability, durability, energy efficiency and fire resistance.
- The manufactured home should pass the third party property inspections.
- Credit score:
Mobile home lenders require a minimum credit score of 680 to offer a mobile home loan. With a credit score higher than that, you can get better rate. - Ownership rights:
- The mobile property that you are purchasing should be clear of any liens. The property under consideration may also be managed by a co-operative association.
- Down payment:
- Depending upon several factors such as the type of loan, value of the home and your credit standing, you may be required to make down payment of 5-10% of the purchase price of the home.
What are the steps that you need to follow to obtain mobile home financing?
If you are planning to buy a mobile home, you need to follow some steps. Some of these steps are same as followed in the general home buying process, whereas some of the steps differ. Here are the steps that you need to follow:
What tax benefits do mobile home loans offer?
If the loan is a mortgage, secured by the mobile home that is your primary residence, then the Federal government will allow you to deduct the interest and property taxes you pay from your income taxes, provided you have purchased the home before September of the tax year. In addition, some states allow you to deduct your property taxes from your state income taxes, provided the Federal timing requirement has been met.
Some states, like Indiana, may permit you to deduct all or part of the rent you pay for the lot your mobile home rests on. In order to determine whether your state will permit you to deduct the lot rent, you should consult a tax professional in your state.
Some states, like Indiana, may permit you to deduct all or part of the rent you pay for the lot your mobile home rests on. In order to determine whether your state will permit you to deduct the lot rent, you should consult a tax professional in your state.
Related Readings
- Can mobile home be used as collateral to get personal loan?
- Mobile Home Reverse Mortgage for seniors
Related References:
To Mary,
" iam trying to mortage my house and land but they are also a mobile home on my land-"
You mean there is a mobile home on your land and you want to get a mortgage against it, right? Well, if the mobile home is in good condition and you qualify for a mortgage, you can get a loan against it. Do you have a clear title to the both the home and the land? Is the mobile home sitting on a permanent foundation? How good is your credit?
To Larry,
" Ihave 2 loans total 100k and change. I am on 80 acres valued at 1400 to 1600 per acre. What can I look for in a loan?"
Are you looking to get a loan using your 80 acres of land? Getting a loan against land is not easy in this economy. Lenders have ceased to process land loans. The few lenders who might offer such loans will charge you high rate of interest. If there is a house on the property which you would like to use as collateral, you can qualify for a loan.
To Yvonne,
If you want to refinance with Greentree, you need to contact them and find out if they can offer you a loan. Have you got in touch with them yet? However, it is a good decision to refinance your existing loan as the interest rate of 11.54% that you are currently paying is way too high. The rates on home loans are quite low at present and if you have good credit you can expect to get an interest rate of anything around 5-6% or may be less than that.
To Brandi,
" My husband and I want to purchase a new mobile home, but have poor credit. Our credit scores are both in the low 500."
I am afraid to say that you will not qualify for a mobile home loan with a credit score of just 500. The depression in the market has made the qualifying criteria for a loan stricter than before. You must have a credit score of 620 to get approved for a mobile home loan or any other type of loan.
To Jan,
It is common practice to charge PMI on loans with LTV ratio higher than 80%. The Fannie Mae guidelines require the borrower to pay private mortgage insurance premium if he/she is putting down less than 20% in down payment. Since your daughter is paying only 10% down payment, she will have to pay the PMI.
To Joseph,
If there is enough equity in the property, you can surely go for a cash-out refinance. You can then pay off your debts and do the required repair work with the extra cash-out money. However, there could be a problem due the fact that your mobile home is on a leased land. Not many lenders would want to do a cash-out refinance on a home that is on a leased land.
" iam trying to mortage my house and land but they are also a mobile home on my land-"
You mean there is a mobile home on your land and you want to get a mortgage against it, right? Well, if the mobile home is in good condition and you qualify for a mortgage, you can get a loan against it. Do you have a clear title to the both the home and the land? Is the mobile home sitting on a permanent foundation? How good is your credit?
To Larry,
" Ihave 2 loans total 100k and change. I am on 80 acres valued at 1400 to 1600 per acre. What can I look for in a loan?"
Are you looking to get a loan using your 80 acres of land? Getting a loan against land is not easy in this economy. Lenders have ceased to process land loans. The few lenders who might offer such loans will charge you high rate of interest. If there is a house on the property which you would like to use as collateral, you can qualify for a loan.
To Yvonne,
If you want to refinance with Greentree, you need to contact them and find out if they can offer you a loan. Have you got in touch with them yet? However, it is a good decision to refinance your existing loan as the interest rate of 11.54% that you are currently paying is way too high. The rates on home loans are quite low at present and if you have good credit you can expect to get an interest rate of anything around 5-6% or may be less than that.
To Brandi,
" My husband and I want to purchase a new mobile home, but have poor credit. Our credit scores are both in the low 500."
I am afraid to say that you will not qualify for a mobile home loan with a credit score of just 500. The depression in the market has made the qualifying criteria for a loan stricter than before. You must have a credit score of 620 to get approved for a mobile home loan or any other type of loan.
To Jan,
It is common practice to charge PMI on loans with LTV ratio higher than 80%. The Fannie Mae guidelines require the borrower to pay private mortgage insurance premium if he/she is putting down less than 20% in down payment. Since your daughter is paying only 10% down payment, she will have to pay the PMI.
To Joseph,
If there is enough equity in the property, you can surely go for a cash-out refinance. You can then pay off your debts and do the required repair work with the extra cash-out money. However, there could be a problem due the fact that your mobile home is on a leased land. Not many lenders would want to do a cash-out refinance on a home that is on a leased land.
We are having a debatein our office. Can a borrower with a moblie home that is owned and parked in a Trailer Park with mionthly rent for the lot quasligfy for the FTHB tax Credit.
Is a manufactured home (double wide) on a permanent foundation considered a permanent home. No wheels, no tongue, and strapped down by code. Does any banks go fixed rate mortgages for these types of home?
Can you get a loan to purchases a moblie home but you rent the spot the home is on
Hi Tim,
Mobile homes do qualify for First Time Buyer Tax Credit. But the tax credit is applicable only in case of a purchase of a real estate property. Mobile homes sitting on permanent foundation on a piece of land owned by the home owner are considered as a real estate property. These homes qualify for the tax credit. However, as far as I aware of, if the mobile home is on a rented lot and is not sitting on a permanent foundation it is considered as a personal property rather than a real estate property. This is why these homes do not qualify for the tax credit. However, it is best to contact the IRS in this regard.
Hi stantheman,
A mobile home on a permanent foundation is considered as a real estate property and a permanent home. These types of loans qualify for a mobile home mortgage loan. Thus, you can surely go for a fixed rate mortgage loan.
FHA offers a Title I loan program to help borrowers purchase either a mobile home or both a mobile home and a land. The home must meet the property eligibility conditions as specified in the HUD guidelines. You need to have a score of 620 at least and a decent income to qualify for the loan.
You may seek a no-obligation free mortgage consultation with the community lenders and check out what type of mortgage you can qualify for. They will consider your financial situation, your credit and your requirements and will offer suggestions on the right kind of mortgage which serves your purpose.
Hi Elaine,
You can get a mortgage loan to purchase a mobile home if you have clear title to both the land and the home. Are you going to rent the mobile home or just the land? If you are going to occupy the property as your primary residence, you can get loans at low interest rates. But if you are going to rent it out, you will have to pay a higher rate of interest.
You, too, can go for a no-obligation free mortgage consultation with the community ranked lenders and see if you qualify for a mobile home loan.
Thanks,
Jerry
Mobile homes do qualify for First Time Buyer Tax Credit. But the tax credit is applicable only in case of a purchase of a real estate property. Mobile homes sitting on permanent foundation on a piece of land owned by the home owner are considered as a real estate property. These homes qualify for the tax credit. However, as far as I aware of, if the mobile home is on a rented lot and is not sitting on a permanent foundation it is considered as a personal property rather than a real estate property. This is why these homes do not qualify for the tax credit. However, it is best to contact the IRS in this regard.
Hi stantheman,
A mobile home on a permanent foundation is considered as a real estate property and a permanent home. These types of loans qualify for a mobile home mortgage loan. Thus, you can surely go for a fixed rate mortgage loan.
FHA offers a Title I loan program to help borrowers purchase either a mobile home or both a mobile home and a land. The home must meet the property eligibility conditions as specified in the HUD guidelines. You need to have a score of 620 at least and a decent income to qualify for the loan.
You may seek a no-obligation free mortgage consultation with the community lenders and check out what type of mortgage you can qualify for. They will consider your financial situation, your credit and your requirements and will offer suggestions on the right kind of mortgage which serves your purpose.
Hi Elaine,
You can get a mortgage loan to purchase a mobile home if you have clear title to both the land and the home. Are you going to rent the mobile home or just the land? If you are going to occupy the property as your primary residence, you can get loans at low interest rates. But if you are going to rent it out, you will have to pay a higher rate of interest.
You, too, can go for a no-obligation free mortgage consultation with the community ranked lenders and see if you qualify for a mobile home loan.
Thanks,
Jerry
imformation on loan for mobile home cost $34000.
Hi Paul,
A loan amount of $34,000 is not too high. If you have a decent income and credit, you should be able to qualify for the loan. What are your credit scores? Are there any negative items on your credit? Do you own the land where you want to place the mobile home? Or do you want to place it on a rented lot? How much down payment have you saved?
A loan amount of $34,000 is not too high. If you have a decent income and credit, you should be able to qualify for the loan. What are your credit scores? Are there any negative items on your credit? Do you own the land where you want to place the mobile home? Or do you want to place it on a rented lot? How much down payment have you saved?
We would like to lower our monthly payments with a low interest mortage loan fixed rate. We have a existing conventional loan on our manufactured home on a perminent foundation. My husband is a Veteran, could we get a refinance VA or FHA even if our present loan is conventional?[/img]
I need a loan to purchase my land to set my mobile home on. and to do some inprovement to my mobile home.
A loan to purchase land
Looking for a mortgage on 55+community manufactured homes on leased land community. Yr to Yr lease
Question? I am a Veteran and live in South Carolina, my mobile home is attached to two acres of land, and is on a permanent foundation. Credit score is around 700. I have tried to obtain a loan but is very difficult with a mobile home. It is paid off and also is a 1972, in very good condition and wanting to install new windows and heat pump. Does anyone know of a lender that will make such a loan in South Carolina? Thank you for your time and consideration.
Question? I am a Veteran and live in South Carolina, my mobile home is attached to two acres of land, and is on a permanent foundation. Credit score is around 700. I have tried to obtain a loan but is very difficult with a mobile home. It is paid off and also is a 1972, in very good condition and wanting to install new windows and heat pump. Does anyone know of a lender that will make such a loan in South Carolina? Thank you for your time and consideration.
I have been tring to get a loan for a mobile home and the rate that I have been told is 10% . I have a 645 score and my husban has a 654 score. we are 1st time buyers and thought that we might get a better rate than that with 10000.00 down. he mobile home is new and the company has given me a great price but the place that the company wants to finance through want buget with the rate. How can I get a better rate :(
My husband and I have owned several houses, but never a mobile home. We are looking to sell our house and downsize our debt by buying a used mobile home and moving it to family owned land. We are having trouble with the financing process due to high down payments (15%) and lenders wanting to give us a variable 10.99% rate. This is ridiculous! Both our credit scores are above 700 and our annual income is $54K. We have money for a monthly payment but no one seems to want to work with us. Any advice for someone seeking financial freedom?