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Mobile Home Purchase Financing
he real estate boom has home park or on leased land).
likely reached its peak, Because the land is not owned by
leaving ownership of a the resident, it cannot legally
traditional single-family home a be attached to the title of the
distant dream far beyond the land (the deed to the land will
price range of many potential not mention the resident), and so
home-buyers. Mobile Homes, which the home is treated as “personal
can typically be bought at property”, as opposed to “real
20%-40% of the price of property”. In cases where the
single-family home, have become land and the mobile home are sold
an increasingly popular (and for together and the home is
many, the only) option for home permanently attached, it is then
ownership. The following are some considered real property and
of the factors to take into given financing treatment similar
consideration to help you decide to a single family home. The
if buying and financing a mobile remainder of this article deals
home is going to make the most specifically with non-attached
sense, and to help you get the mobile homes.
best loan terms possible.
No matter who you go through for
A mobile home is defined as any financing, the following
home that was built/manufactured tips/guidelines are almost
at a remote facility, and then universal in the mobile home
transported to an offsite lending industry:
location with a tractor-trailer.
One major characteristic of a • Your interest rate will likely
mobile home is that the land range from an 8.75% to a 10.75%.
underneath the home is not owned
by the mobile home resident (it • Homes built after 1976 qualify
is usually situated in a mobile for the best rates and programs
(i.e. Post HUD homes).
• There are no zero down mobile
• Obtaining a loan on a home home loans, the minimum down
built before 1970 can be payment is 5%.
extremely difficult; expect a
high rate and a large (at least • The best rates come at 20% down
30%) down payment requirement. or more.
• Rates on singlewide homes are Mobile home loans are more
usually 0.5% to 1% higher than on difficult to qualify for than
multi-wide homes. single family home loans. If you
are considering buying a mobile
• The longest loan term is home, the first thing to do is to
usually 20 years (Blue Coast does make sure your financing is in
offer a 30 Year Fixed). order by getting pre-approved.
Mobile home lenders are
• Many loan programs require a surprisingly rare. If you walk in
minimum credit score (Fico score) to your local bank or credit
of 660. union, it is extremely unlikely
that they will have programs for
• If you cannot verify that you mobile homes, because mobile home
earn at least twice as much as loans are difficult to sell on
your total monthly debt the secondary market (the vast
(including the proposed new home majority of all mortgage loans
payment) with paystubs, tax end up being sold to insurance
returns, or pension/social companies or foreign investors on
security/disability award Wall Street, even if your
letters, most lenders will original lender continues sending
require you to put at least 30% you the monthly bill on the new
down, and charge a higher rate. note holder’s behalf). Most banks
are not willing to tie up their worse in rate and/or fees than
capital for long-term un-sellable you would obtain from an outside
mobile home loans. You should lender (it is important to keep
contact a mobile home lender such in mind that both the rate and
as Blue Coast Home Loans for a fee combination that is
pre-approval and a quote. A important, neither matters by
legitimate lender will not charge itself). The dealer’s lenders
you any out-of-pocket fees for a often feel they have a captive
loan pre-approval, and a audience, and since the
pre-approval is usually necessary competition is scarce to begin
to tell you with certainty what with, they often feel no need to
your interest rate will be. Along offer competitive loan terms.
with the rate, a mobile home loan Many times even a “normally
specialist can let you know what competitive” lender is unable to
your monthly payments will be at offer the best financing terms
different loan amounts, which can when using a dealer referral,
be useful to help you determine because in order to have the
how much of a home you can privilege of being the “dealer’s
afford. lender”, they must offer a
kickback to the dealer (pay the
If you are considering buying new dealer $2000 for every referral),
or used from a dealer, they will and they must pass this cost on
almost definitely have a lending to you either in the form of
partner in place, and try to push increased fees or a higher
you into their financing terms. interest rate. If you don’t have
Using the dealer’s lender can the time/inclination to find a
sometimes be more convenient, but good 3rd party mobile home lender
the drawback is that the (as I mentioned, they can be
financing terms you get through difficult to locate), and you
the dealer’s lender are usually don’t mind paying a slightly
higher rate and/or fees, going
through the dealer’s lender is Record home prices are
probably the most convenient encouraging potential home-buyers
route. to consider all the options, and
many are now realizing the
Because a mobile home purchase is current quality, convenience and,
a huge investment, it is of course, affordability of
important to carefully consider manufactured homes is on par with
all of the factors. A 1977 many traditional single-family
multi-wide home that costs homes, and are available at a
$100,000 may have lower monthly fraction of the cost. In short,
payments than a 1975 single wide after considering all the factors
that sells for $80,000, because and armed with the necessary
the more expensive home will knowledge to make a sound
carry a much lower interest rate. decision, you might find that a
The age of the home, size of the manufactured home is the right
home, and your down payment all fit for you.
play a large role in determining
your financing terms
About the Author:
http://www.bluecoasthomeloans.com
Read more articles by: George Briggs
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