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:
my credit score is not that great do to vehicles i bought when i was younger will i still be able to get a loan to buy a mobile home
Credit score is an important factor in order to get qualified for a mortgage. Unless you have a score of around 600-680, you won't be able to get a FHA loan. You should have a score of 700-720 in order to get a conventional mortgage.
Excellent Quality 1979 in a mobil home in an an over 55 updacale park $38,000. We are seeking fiancing due to a recently Bankrupcy. We had excllent credit history prior to this. I have excellent work history, and persaonl references. i am still working my husband is retired with a current part time consutling business. What are our best options for finding a lender?
My husband had a bankruptcy due to divorce several years ago but his credit score is now 630. I had a debt reconsolidation and my score is 610. We have both been at our jobs for over 6 years and together make 70,000 per year. We have found a mobile home that we love for 29,900 but are having problems finding financing. Any suggestions?
If I have $5000 to put down for mobile home and having bad credit, will I still be able to get a loan :cry:
With a bad credit, you won't be able to qualify for a loan to buy a mobile home. You will have to improve your credit in order to get a loan.
I HAVE 16X80 W/LAND AND I HAVE SOMEONE WHO WANTS TO BUY IT.THEY WANT TO PUT A PERMAMENT FOUNDATION AFTER THE LOAN AND A ZERO DOWN PAYMENT.IN THE STATE OF SOUTH CAROLINA
Hi edlawson,
The buyer will have to contact the local lenders and check out if they will be ready to give him/her a loan when there is no permanent foundation. This will be solely the lender's discretion.
Thanks,
Jerry
The buyer will have to contact the local lenders and check out if they will be ready to give him/her a loan when there is no permanent foundation. This will be solely the lender's discretion.
Thanks,
Jerry
yes i was wanting to know if i find 5 acres of land to purchase can i go through Clayton homes or loves to purchase a manufactured home and have the home and land financed through them, combining both loans into one.
Welcome dreammaker,
As far as I can understand, you can combine both the loans into one.
As far as I can understand, you can combine both the loans into one.
how old can a mobiile home be to qualify
Hi sccsm,
Mobile homes which are build before 1976 don't qualify for mobile home loans. Mobile homes which are built after that will qualify for loans.
Thanks
Mobile homes which are build before 1976 don't qualify for mobile home loans. Mobile homes which are built after that will qualify for loans.
Thanks
i have property (2.7 acres) with septic tank, well already, paid for. i want to get financing for the mobile home and willing to put the property up for collateral. we have bad credit, but have been on our jobs for 14+ years(myself), my husband (3 years). the problem with our credit came about because of medical issues, but now getting on our feet. we have paid off two mortgages in the past though. we just need the money for the mobile home, we have the rest already done. can we find financing, even with high interest... we expect that and are willing to pay high interest and then refinance later
Hi Lindalee,
You can apply for personal property loans which are available with the retailers who sell off mobile homes. These loans are, however, available at a higher interest rate.
Thanks,
Jerry
You can apply for personal property loans which are available with the retailers who sell off mobile homes. These loans are, however, available at a higher interest rate.
Thanks,
Jerry