Three Types of Manufactured Home Loans

Be sure to get the right loan for your new or existing manufactured home. This article discussed the basic loan types.

The three major loan programs for a manufactured home are: FHA, Conventional and Equity Loans. These programs are for manufactured homes on real estate you own, or will own. Not for homes in a park where you lease the land.

If the company you call can’t do your loan, you won’t often be successfully referred to another company, that can do your loan, because the loans are funded from different sources that do not interact with each other.

It depends on whether the manufactured home is brand new or previously lived in as to the loan program you can get.

If you buy a brand new manufactured home, sold to you by the dealer, he may be able to
offer you some loan programs, both Government and Conventional, that other
loan sources do not have.

But, if he can’t do the loan, he probably won’t send you to a Mortgage Broker who might help you. That is, unless he hopes a Mortgage Broker will have loan programs he doesn't offer.

The Mortgage Broker has programs, for financing manufactured homes, that are not brand new homes. The Broker can offer you FHA and Conventional loans, just like the dealer, but only for properties that are already standing and permanently affixed to real estate that you own or will own.

If FHA proposed changes pass there may even be 100% financing available for manufactured homes. But even now, if your income is low enough, you can get a 96.5% purchase loan for your manufactured home.

The Mortgage Broker can offer you the third type of lending as well. This is called Equity Lending. (Hard Money Loans). The loan guidelines are only concerned with the lender equity position created through the loan. They don’t consider borrower credit at all. Call me to discuss information about at types of
credit allowed.

Equity loans are made by individuals and offered through mortgage companies. This is one step away from borrowing from an individual. They make short term loans of three to fifteen years. The rates are high, and the loan to value percentage is low, but sometimes this is the only type of loan you can qualify for right now.

For instance, if you wanted to buy a manufactured home or just move one on to
property you want to buy or already own, you might need an equity loan to get the home set-up and ready to refinance. After the installation, you can obtain a traditional type of long term loan. Please see more information at California 433a Occupancy Certificate Information.

Please note that all loan types do not allow financing on manufactured homes installed more than once. FHA, for instance, tracks the home history to be sure that the home came from the dealer to be installed on the location where it presently is.

With the equity move-on-loan you have to put at least 10% down, based on the future value of the property when the home is completed. The future value can be used because your new home will be compared with similar homes in the immediate area that are already completed and have a known value. In that sense, the value of your home is established before it is
constructed.

If you have equity in the land the home will be put on, the land equity is counted for you, as a credit, in the lending formula. And, if you have already paid money for construction related work, that money is counted toward your
10% as well.

Manufactured housing is a popular alternative to “stick” built homes today. Manufactured home financing is a little different, so be sure to know all your alternatives before you sign for a loan that may not be the best for you.

Sellens Real Estate Lending is a Southern California Based Real Estate Mortgage Broker offering Loan Programs for all types Properties, not just manufactured homes.

The Company was started by Judith A. Sellens in Orange County in 1991. She has 35-plus years experience in real estate related fields. The Company Home Office is in Yucaipa, California and is licensed by the California Department of Real Estate, with a mortgage loan originator endorsement by NMLS.

Judy Sellens Sellens Real Estate Lending judy@sellenslending.com

Beautiful Location

Many manufactured homes are set in sites like this.