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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:
Hey berry,

If you do not have a good credit score, then it will be difficult for you to get approved for a mobile home loan. You will first have to improve your credit score and look out for loans. To know more about how to improve credit, check out the following link:
http://www.mortgagefit.com/credit-rating/credit-repair.html
Posted on: 26th Jan, 2009 10:49 pm
my credit score is abour 575 is it possible to get a loan? if mso where
Posted on: 27th Jan, 2009 11:02 am
i have a mobile home and would like to consolidate and refinace my home i cant seem to find anyone to deal with a mobile home. any suggestions
Posted on: 27th Jan, 2009 05:40 pm
Welcome,

To grace,

In my opinion, 575 is not a very good credit score. In order to get a mortgage, you will have to improve your credit score first. To know more about improving credit score, check out the following link:
http://www.mortgagefit.com/credit-rating/credit-repair.html

To stressed,

Did the lenders give you any reason as to why they are not refinancing your loan? You may seek a no obligation free mortgage consultation from the lenders of this community. Let's hope they will be able to help you.
Posted on: 27th Jan, 2009 11:22 pm
I have a credit score of 579, and no money for a down payment. What is my best option on attempting to get a loan for a mobile home in a park?
Posted on: 28th Jan, 2009 03:50 pm
Hi sff,

With a score of 579, it will be difficult for you to get a loan. Moreover, you will be unable to pay the down-payment as well. So chances of getting a loan is low. In my opinion, you should first try to improve your credit score and then look out for a loan. To know more about improving credit score, check out the following link:
http://www.mortgagefit.com/credit-rating/credit-repair.html

Thanks
Posted on: 29th Jan, 2009 12:32 am
My boyfriend and I make a joint income of about $50,000.00 per year with a credit score of 640-650. We are really interested in a mobile home (double wide) on its own land. The home is a few years old. We were wondering if you think we could get a mortgage with 100% financing.
Posted on: 29th Jan, 2009 08:32 am
Welcome SJJS,

You can speak to the lenders and check out the terms and conditions of the loan. With the type of credit score you have, you may get a loan. But it would have been better if you credit score would have been in the 700s.

I don't think you will be getting 100% financing. You will have to pay some down-payment and go for a PMI. You can even seek a no obligation free mortgage consultation from the lenders of this community and know about the rates you may get.
Posted on: 29th Jan, 2009 11:35 pm
In process of getting a loan on a 2004 manf. loan on 2.5 acres. Quoted 5 % with 1.75 pts from my bank's loan officer. I said lock it. Then she e-mailed that she had to add 1.25 pts for my fico scores (660+). Got a Loan approval letter after that it the mail with 5% and 3.75 pts!! She locked me in and I didn't agree to the terms. Looking for another lender who gives me what I'm quoted. Any takers?
Posted on: 31st Jan, 2009 11:08 pm
i need to refinance my mobile home. the land is paid for and i already got a appraisal and i have $45,000 equity. i would like to get some money to pay off some credit cards with my new loan. where should i start to look to get a loan? i have called around and nobody wants to deal with double wides or mobile homes.
Posted on: 02nd Feb, 2009 01:00 pm
I am a mobile home dealer, selling new and used homes and I am looking for alternate sources of financing for my customers. Do you finance used homes in Oklahoma?
Posted on: 04th Feb, 2009 06:14 am
i am in a land contact with a company that sells homes and property that have dressed up repairs that you can't see until later. i have put alot of work into the home and needto do more. do i apply for refinance, home equity, or purchase loan?
Posted on: 04th Feb, 2009 10:41 am
Hi Shelley,

I think you should consult the lenders in this community. You can go for a no-obligation free mortgage quote on the right loan offer that can suit you the best. The lenders will let you know what rates and points you may qualify for. You can then compare the offers from different lenders and choose the one you prefer.

Take care
Posted on: 06th Feb, 2009 04:02 am
Hi hwdarlene,

Why do you want to take out a loan on your mobile home just to pay for credit cards? If at all you're unable to pay for the cards, you should try and consolidate them. You should go for a debt consolidation program which will help consolidate multiple credit cards into a single payment each month. In case you can't pay the minimum payment on your credit cards, it's best to go for debt settlement.

I know of a debt community - debtconsolidationcare.com, which helps people out of credit card debts and other bills. You can talk to their financial coach who'll provide you with free debt counseling on how to get rid of cc debts.

Good luck
Posted on: 06th Feb, 2009 04:08 am
Ginger,

You need to talk to a lender about this. Perhaps some of the lenders in this community can help you.
Posted on: 06th Feb, 2009 04:16 am
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