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:
Hi Tami,
You may apply for a 80/20 loan but now a days lenders hardly approve such loans. If you are unable to give the 20% downpayment, then you can go for a private mortgage insurance. If you do not want to go for it, then you can ask your friends or relatives to gift you the downpayment amount.
Thanks
You may apply for a 80/20 loan but now a days lenders hardly approve such loans. If you are unable to give the 20% downpayment, then you can go for a private mortgage insurance. If you do not want to go for it, then you can ask your friends or relatives to gift you the downpayment amount.
Thanks
I have 1.5 acres of property that i want to use as a down payment bt I have bad credit(503) and I want to know how hard it is goping to be to get a loan.I have gaurenteed income very month.
Are there any lenders that will make loans for mobilehomes build pjrior to 1976?
Hi carlajc,
With a bad credit score of 503, you won't be able to get a loan though you sell off your land and pay the downpayment. If you are planning to get a FHA loan, you would require a credit score of 600-620. For conventional loan, you would require a credit score of 700-720.
Hi jyates,
Mobile homes which are build prior to 1976 do not qualify for loans. I don't think there are lenders who would finance such properties.
With a bad credit score of 503, you won't be able to get a loan though you sell off your land and pay the downpayment. If you are planning to get a FHA loan, you would require a credit score of 600-620. For conventional loan, you would require a credit score of 700-720.
Hi jyates,
Mobile homes which are build prior to 1976 do not qualify for loans. I don't think there are lenders who would finance such properties.
I own outright a single wide (1979) on acreage that my sister lives in. I was hoping to get a loan on the property to consolidate some of my debts instead of taking a home equity out on my own home. Is that possible? What banks do loans on a second home for a single wide trailer?
hi gary,
you should have an excellent credit score and stable financial situation in order to get a refinance. i think it would be difficult for you to get a refinance for the 3 properties together. i would suggest you to have a word with your present lender and check out if he is ready to refinance the loans.
hi sleeper,
most lenders would not be ready to give you a loan for a second property. if lenders find that you have excellent credit score and a stable income, they may consider giving you a second mortgage.
you should have an excellent credit score and stable financial situation in order to get a refinance. i think it would be difficult for you to get a refinance for the 3 properties together. i would suggest you to have a word with your present lender and check out if he is ready to refinance the loans.
hi sleeper,
most lenders would not be ready to give you a loan for a second property. if lenders find that you have excellent credit score and a stable income, they may consider giving you a second mortgage.
I purchase a mobile home and 1.2 acres of land 7 years ago, the seller
took back the paper and i have made all but 5 payments, The purchase
price was $57,000. The monthly payments have been $518.00.
The seller recently got into financial trouble and since the land was still
in his name till the note was paid, the bank put a $30,000 judgement on
my land. Now the Bank wants the 11,000 which is the appraised value of the land or they are going to auction
my land to pay off the sellers debt. I have the title to the mobile home.
I and my husband have less than perfect credit and we are having a
hard time finding someone to finance the land, We are willing to use
the mobile home and land. Can you help.
Sandra at Sgenecouch1958@ yahoo.com
took back the paper and i have made all but 5 payments, The purchase
price was $57,000. The monthly payments have been $518.00.
The seller recently got into financial trouble and since the land was still
in his name till the note was paid, the bank put a $30,000 judgement on
my land. Now the Bank wants the 11,000 which is the appraised value of the land or they are going to auction
my land to pay off the sellers debt. I have the title to the mobile home.
I and my husband have less than perfect credit and we are having a
hard time finding someone to finance the land, We are willing to use
the mobile home and land. Can you help.
Sandra at Sgenecouch1958@ yahoo.com
I have been threw 2- 5 year loan and all I want is a FHA/HUD 30 year loan at a price I can afford. I am coming due for a 3rd time for the 5 year loan. where can I get a mortgage and get a little money to finish the projects on the land and maybe remodel the house because it does need it.
Hi Sandra,
As the bank has placed a judgment on the property, then it would be difficult for you to get finance for the property. The lenders will want you/seller to clear off the judgment and then apply for a loan. You should ask the seller to clear the dues immediately or you may have to lose the property. I would also suggest you to have a word with your attorney and take his suggestions in this regard.
Hi fmgarner,
You should contact FHA lenders and apply for a loan. You should have a minimum credit score of 600-620 in order to qualify for a loan. You should not have large number of negative items on your credit report. Apart from this you will have to give a down payment of 3.5% to get a FHA loan. You can speak to the lenders of this community and seek a no obligation free mortgage consultation in order to know what type of rates and terms you would receive.
As the bank has placed a judgment on the property, then it would be difficult for you to get finance for the property. The lenders will want you/seller to clear off the judgment and then apply for a loan. You should ask the seller to clear the dues immediately or you may have to lose the property. I would also suggest you to have a word with your attorney and take his suggestions in this regard.
Hi fmgarner,
You should contact FHA lenders and apply for a loan. You should have a minimum credit score of 600-620 in order to qualify for a loan. You should not have large number of negative items on your credit report. Apart from this you will have to give a down payment of 3.5% to get a FHA loan. You can speak to the lenders of this community and seek a no obligation free mortgage consultation in order to know what type of rates and terms you would receive.
I have a mobile home with clear title on it. Is there anything I can do with that??
Hi tycerda,
Do you want to sell off your mobile home? If yes, then you will have to list the property in the market and check out if you can get buyers for your property. You can even use the property as collateral and get a mortgage for home improvements, paying off credit cards, medical bills, etc.
Feel free to ask if you've further queries.
Sussane
Do you want to sell off your mobile home? If yes, then you will have to list the property in the market and check out if you can get buyers for your property. You can even use the property as collateral and get a mortgage for home improvements, paying off credit cards, medical bills, etc.
Feel free to ask if you've further queries.
Sussane
im looking into trying to purchase a forclosed on munufactured home on bout an acre of land. What is the best way to go with lower credit standings and not alot to put on down payment?
Just my 2 cents but why would anyone buy a mobile home--they never appreciate--they only would if they were on a great peice of land that appreciated but the mobile home never apppreciates.
I think if anyone is thinking this is all they can afford they should check actual home prices and they may be surprised--- the market will change in a few years and homes appreciate again but mobile homes do not!
I think if anyone is thinking this is all they can afford they should check actual home prices and they may be surprised--- the market will change in a few years and homes appreciate again but mobile homes do not!
how long do we have to wait to qualify for a loan on a manufactured home