Manufactured Housing News

Buying your first mobile home in a park is a cost-effective and flexible way to become a homeowner. However, navigating the process of applying for and getting financing can be a bit challenging. When your mobile home is located within a park of other mobile homes, there are certain unique loan requirements and classifications. Triad has a thorough guide to help you understand the basics of this process. However, seeking further advice from experts will help you feel even more ready to purchase your first mobile home. 

Mobile homes in parks are usually considered personal property, rather than real estate, because the land it sits on is leased and not owned by the resident. This classification can affect your options, meaning you’ll need to look into specialized loans for financing a mobile home that are different from traditional mortgages. 

Chattel Loans

These are personal property loans designed for mobile homes that are not permanently affixed to the land they sit on.

Benefits: You can usually get approved quicker than some traditional loans, and there’s often a lot of flexibility in the loan duration.

Drawbacks: Interest rates are usually higher than traditional mortgages because of the perceived risk that the lenders are taking on.

FHA Title I Loans

These loans are insured by the Federal Housing Administration (FHA) and are specifically meant to target mobile homes in parks.

Benefits: They offer competitive interest rates and allow for longer repayment terms. Additionally, Title I loans can cover both the home itself and associated transportation or setup costs.

Drawbacks: Borrowers must meet strict eligibility criteria, including a maximum loan limit and guidelines on how the funds can be used.

VA Loans

Veterans Affairs (VA) loans support eligible veterans or active service members who are buying mobile homes, whether as personal property or real estate.

Benefits: VA loans typically feature low or no down payments, competitive interest rates, and favorable terms. For mobile homes in parks, they provide crucial support for veterans in need of affordable housing.

Drawbacks: Strict eligibility criteria limit this option to only veterans and active-duty personnel. Plus, not all lenders offer VA loans for mobile homes.

How Do I Start The Process?

Look at your credit score. A solid credit score is essential for securing favorable loan terms. Go over your credit report and work on improving your score if needed.

Compare different lenders. Not all lenders offer mobile home financing, especially for those in parks. This is where a company like Triad, who specializes in mobile home loans, comes in handy.

Look at your budget. Think about your loan as well as other costs like insurance, transportation, and setup fees. Park lease fees are a recurring expense that should be factored into your monthly budget. 

Securing a loan for a mobile home in a park can be confusing due to the classifications of personal property and lender options. However, if you work with a reliable financial service like Triad, they can advise you on what’s best for your situation. Don’t just go to any lender or financial advisor— look for someone who specializes in buying and financing mobile homes. Whether you consult with a third party company or do all the research yourself, be sure you’ve landed on a financing option that suits all of your needs as a new homeowner.