Manufactured Housing News

Manufactured homes offer an affordable path to homeownership, especially for first-time buyers or those looking to downsize. However, financing a manufactured home can be more complicated than just getting a traditional mortgage. That’s why understanding your options and the steps involved is essential. In this guide, we’ll walk you through how to get a loan for a manufactured home so you can make a confident, informed decision.

What is a Manufactured Home?

Before jumping into financing, it’s important to understand what qualifies as a manufactured home. These homes are built in a factory and transported to a site for installation. They’re constructed to meet HUD (U.S. Department of Housing and Urban Development) standards and are often confused with mobile homes, which refer to factory-built homes made before June 15, 1976.

Manufactured homes can be placed on leased land, in mobile home parks, or on private property you own. Where the home is located plays a big role in your financing options.

Step 1: Know the Type of Loan You Need

There are two main types of loans available for manufactured homes:

1. Chattel Loans

These are personal property loans used when the manufactured home is not attached to land that you own. Instead, it's treated as movable personal property—like a vehicle. Chattel loans generally have higher interest rates and shorter terms than traditional mortgages, but they’re often easier to qualify for.

2. Conventional Mortgages

If your manufactured home is permanently affixed to land you own and meets HUD standards, it might qualify for a traditional mortgage. This could mean better interest rates and longer loan terms. Conventional loans usually require the home to be classified as “real property” rather than “personal property.”

Step 2: Understand Government Loan Options

Several government programs make it easier to finance a manufactured home:

• FHA (Federal Housing Administration) Loans: These loans are available for manufactured homes with as little as 3.5% down. The home must meet HUD standards and be on a permanent foundation.
• VA (Veterans Affairs) Loans: If you're a qualifying veteran or active service member, a VA loan can finance a manufactured home with no down payment and favorable terms.
• USDA Loans: Designed for low- to moderate-income buyers in rural areas, USDA loans may cover both the manufactured home and the land.
  
  

These government-backed loans often come with lower interest rates and more lenient credit requirements.

Step 3: Meet the Basic Requirements

To qualify for a loan on a manufactured home, you’ll typically need:

• A minimum credit score (usually 620+ for conventional loans, though some government loans might allow lower)
• Proof of steady income and employment
• A reasonable debt-to-income (DTI) ratio
• A down payment (the amount varies by loan type)

Also, lenders might require the home to be a double-wide or larger, newer than a certain year, and placed on a permanent foundation.

Step 4: Shop Around for Lenders

Not all lenders finance manufactured homes, so it’s smart to shop around. Look into:

• Banks and credit unions
• Online mortgage lenders
• Specialized manufactured home lenders
• Government loan programs
  
  

Compare their rates, terms, fees, and eligibility requirements to find the best fit for your situation.

Step 5: Prepare Your Documents

When you’re ready to apply, gather all the documents you’ll need, such as:

• Proof of income (pay stubs, W-2s, or tax returns)
• Credit report
• Identification
• Information about the manufactured home and land
• Down payment funds and proof of assets
  
  

Having these ready can speed up the approval process.

Getting a loan for a manufactured home might require a few extra steps, but with the right preparation, it’s very achievable. Whether you’re financing your home by itself, or the home and land together, there are several options designed to fit your unique needs. Do your research, talk to knowledgeable lenders, and don’t hesitate to ask questions along the way. Homeownership is closer than you think.