Manufactured Home Loans, Modular Home Loans, and Mobile Home Loans

Manufactured home and Mobile Home Loans requirements are almost the same and they are very similar structures that were built after June 15, 1976. In 1976, the U.S. Department of Housing and Urban Development (HUD) put new safety standards into effect for mobile homes and changed the name of these structures going forward to “manufactured” homes rather than “mobile.” The main difference between manufactured and mobile homes is that manufactured homes abide by the new safety regulations set in place by HUD while mobile homes were built prior to their implementation. Mobile homes were also often intended to be easily movable, whereas many manufactured homes are not built to move after they are assembled.

 

What are the requirements for getting a Manufactured or Mobile Home loan?

• MUST OWN THE LAND NO LEASED LAND ALLOWED
• DOUBLE WIDE ONLY
• No SINGLE WIDE
• Minimum Loan Amount $150,000.
• Up to 50% DTI.
• 3.5% Down Payment for purchases and 85% LTV for refinances.
• Purchase or Refinance and Cash-out.
• Primary residence, second homes, and investment properties.
• 30-Year Fixed or ARM Rates.
• Credit scores as low as 620.
• Permanent foundations Only.
• Must be on owned land, No leased property allowed.
• Financing for new and used manufactured homes Built after to 1976.
• Used Manufactured Homes (person-to-person) type transactions must be ready for immediate occupancy. Move‐In Ready condition at the permanent location required.
• No Rehab loans available or financing are available.

The Difference Between Mobile And Manufactured Homes

How To Qualify For Mobile Home Financing

Financing a mobile or manufactured home is a little different from financing a house because most lenders do not consider these homes eligible for most types of mortgage. Some lenders will give you a loan for a manufactured home if it meets their specific requirements and rests on a permanent foundation, but often it is difficult or impossible for manufactured homes to be considered real property, especially if you don’t own the land under your home.

Types Of Loans For Mobile Or Manufactured Homes

For those looking to finance a mobile or manufactured home, you have a few options. Let’s explore each one and some of the requirements plus the pros and cons that come along with them.

Conventional Loans

Most lenders will not give you a conventional loan for a mobile or manufactured home because these structures are not considered real property. If you have a manufactured home that meets some very specific criteria, however, conventional mortgage sources Freddie Mac and Fannie Mae do actually offer specialized loans.

Fannie Mae

While not all lenders finance manufactured homes, some may offer Fannie Mae’s MH Advantage® program, which allows buyers to finance manufactured homes over 30 years with down payments as low as 3%. To qualify, however, your home will need to fit very specific criteria. For instance, the home must be at least 12 feet wide, have a minimum of 600 square feet, cannot be on leased land, etc These requirements are similar to Fannie Mae’s – the home must be built on a permanent chassis, must be considered real property, has to have at least 400 square feet of living space, etc.

FHA Loans

The Federal Housing Administration (FHA) offers home loans with fixed interest rates and lower credit, debt-to-income ratio and down payment requirements that are popular with first-time home buyers. They also offer manufactured home loans called Title I and Title II loans.

Title I loans can be used to purchase manufactured homes but not the land on which they sit. There are a few stipulations, such as that the property must be your primary residence, it has to meet FHA guidelines before being placed on a rental site, must be connected to utilities, etc. These loans tend to have short terms (typically up to 20 years) and low loan limits.

Title II loans can be used to purchase both a manufactured home and the land it sits on jointly. These loans cannot be used in mobile home parks or on leased land. Mobile homes to do not qualify as it’s required that the home being financed was built after 1976. These loans also require that the manufactured home in question counts as real property.

VA Loans

Similar to a Title II FHA loan, if you want to buy a manufactured home and the land it sits on, you can also get a VA loan. VA loans are only available to veterans and qualifying active duty service members through the Department of Veterans Affairs. There are many benefits that come with a VA loan, including the ability to put no money down and avoid paying mortgage insurance.

To qualify for a VA loan for a manufactured home, your home must be on a permanent foundation, meet HUD guidelines and must be purchased with the land underneath it; mobile homes do not qualify.