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Mobile home loan – A less costly option to buy homes

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?

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.

    On the basis of land ownership:


  • 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.

  • On the basis of lending authority:


  • 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.

  • On the basis of other factors:


  • 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.

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 -

  1. 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.
  2. 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.

  3. 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.
  4. 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:


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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.

Related Readings
Related References:
Welcome to the site there are several professionals on this site that will be able to help you.
Posted on: 03rd Jun, 2008 06:55 pm
Hi vatthana.

Welcome to the forum.

Can you say some thing about your credit and employment history? It will help us to suggest you better.

BTW you can request for no-obligation free mortgage quote from the community lenders. You just need to give minimum details.

Hope someone will help you out.

Best of luck,
Larry
Posted on: 04th Jun, 2008 04:31 am
Hi larry,

I knew you would be able to help you are awesome! :D
Posted on: 05th Jun, 2008 07:18 am
HI,

I WANT TO KNOW THAT HOW CAN I GOT THE MOBILE LOAN FOR MY NEW DREEM HOUSE IN MY VILLAGE AT INDIA - RATNAGIRI - KHED.

I WANT TO KNOW I CAN GET OR NOT GET?

IF I CAN THEN TERMS AND CONDITIONS....ETC.



REGARDS,
TANVEER.
Posted on: 22nd Jun, 2008 01:10 am
Well I suppose you'll have to contact a local lender there in India.
Posted on: 22nd Jun, 2008 09:13 pm
Yea that makes sense adonis.
Posted on: 23rd Jun, 2008 05:47 pm
hi there..
My mohter recently passed away and we are trying to sell he mobile home. (Calif.) The park owner requires buyers to show financial proof of 4 times the amount of the pad rental fee. Is this standard?
Thank you very much for your time.
Posted on: 07th Jul, 2008 07:44 pm
I was reading your response to Tellta on Sept 12 and it stats that the loan can not be less than 20,000. I had a loan that I was looking to refiance for a better interest rate but it's less than 20,000 about 18 or 19 is my current balance. Is there anything I could do or am I now stuck. I've purchased the home at 25,000 five years ago. Does this mean I'm now stuck?
Posted on: 08th Jul, 2008 08:15 pm
hi leiker.

i am not aware whether it is the standard or not but even if it is a standard then it may vary from one state to another.

hi loanamount.

i think that the maximum limit is $ 20000, so you should be able to refinance. have you contacted with any lenders. if not then you should shop for lenders. you can even ask for no-obligation free mortgage quote from the community professionals to get better rates and terms.

hope it helps. feel free to ask if you have any further questions.

best of luck,
larry
Posted on: 09th Jul, 2008 03:49 am
Since I never expected to be able to afford a home, I pay for everything. Consequently, I have no credit. I have more than enough documented income to afford a mortgage of 20,000. I've been paying 1200 mo in rent for 4 yrs. Can you help me ?

Thank you for your prompt response.
Posted on: 14th Jul, 2008 05:53 pm
Welcome Fran.

Are you saying that your credit is bad? If so then how bad is your credit? To get approve for a mobile home loan your credit should be around 680. If your credit score is lower than that then you should try to improve your credit. I feel you should check out the Credit Repair Tool to analyze and fix your Score at http://www.mortgagefit.com/calculators/credit-repair.html

Let me know if you have any further queries.
Posted on: 15th Jul, 2008 04:55 am
can u advise me of a lender who will finance a doublewide mobile home with poor credit score due to divorces as such. i am not afraid to pay the high interest. can u refer me to a lender that will help me get in a home
Posted on: 11th Aug, 2008 01:34 pm
Hi Ssq,

Welcome to the forums.

Can you tell me how bad your credit score is? I guess it's better if you can repair it and then look for a loan on your mobile home. There are lenders who offer free services in repairing credit when it comes to providing loans to poor credit borrowers. So, yes, you can start shopping for the right loan. What you can do is, look for no-obligation free mortgage quotes from the lenders in this community. To know what happens after requesting for quotes , please refer to the Mortgage quote page.

Take Care
Posted on: 12th Aug, 2008 03:15 am
I have an interested buyer for my 1983 skyline double-wide manufactured home. He has a credit score above 600 but I don't know how much above. The price is $25,000 and he has $5,000 to put down. He has a pension and social security as income (he is disabled). He is having a difficult time finding financing. The home is in a park (on rented land). He is looking for a 10 yr personal property loan. Why can he look that he would qualify?
Posted on: 20th Aug, 2008 09:09 am
Oh, the home is in Utah (if that makes any difference)
Posted on: 20th Aug, 2008 09:13 am
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