Hello. I’ve always been discouraged by real estate agents in considering mobile homes for the reason that financing would not normally be available. Is that really the case? Where does one normally go to get financing to buy mobile homes if ever?
Banker · Nationwide · Member since 2020 · 2k+ posts · 1k+ votes
3y
Louie,
There is nothing wrong with buying a Manufactured home and to be honest in this market its a great idea if you can find a good deal. Here is what you need to know up front to avoid issues or problems during the loan process/appraisal.
Try and find a MH that was built within the last 15 years the rule is built before June 16th 1976 but most lenders now only want something less than 15-20 years old.
Must be a double wide or larger to avoid majority of lender issues - Cannot have been moved from another location accept from the actual dealer.
Must be on a permanent foundation - On a concrete slab off the axles and in certain states have hurricane tie downs and may require "skirting" (lower portion covered to not see space underneath)
Must make sure that MH is permanently connected to a sewage, and septic tank and all utilities and an be lived in right away.
Your real estate agent may or may not know these requirements but a good Banker/Loan Officer will help you during your search. You can look at the MLS or property website and it should list all of these descriptions above and if not you or the Banker, Lo or Realtor can call.
FHA offers 3.5% down, VA offer 100% Financing if you are a Military Veteran, and Fannia Mae offers 3-5% down for first time home owners. Rates are based on your credit score and loan size. My advice is to try and keep mortgage/loan amount above $125k for better rates and overall approval. Keep in minid the MH must be on its own parcel of land and not in a shared community you or in a mobile home park.
I hope this helps build some confidence and if you have other questions I am happy to answer just message me.
Banker · Nationwide · Member since 2020 · 2k+ posts · 1k+ votes
3y
Louie,
There is nothing wrong with buying a Manufactured home and to be honest in this market its a great idea if you can find a good deal. Here is what you need to know up front to avoid issues or problems during the loan process/appraisal.
Try and find a MH that was built within the last 15 years the rule is built before June 16th 1976 but most lenders now only want something less than 15-20 years old.
Must be a double wide or larger to avoid majority of lender issues - Cannot have been moved from another location accept from the actual dealer.
Must be on a permanent foundation - On a concrete slab off the axles and in certain states have hurricane tie downs and may require "skirting" (lower portion covered to not see space underneath)
Must make sure that MH is permanently connected to a sewage, and septic tank and all utilities and an be lived in right away.
Your real estate agent may or may not know these requirements but a good Banker/Loan Officer will help you during your search. You can look at the MLS or property website and it should list all of these descriptions above and if not you or the Banker, Lo or Realtor can call.
FHA offers 3.5% down, VA offer 100% Financing if you are a Military Veteran, and Fannia Mae offers 3-5% down for first time home owners. Rates are based on your credit score and loan size. My advice is to try and keep mortgage/loan amount above $125k for better rates and overall approval. Keep in minid the MH must be on its own parcel of land and not in a shared community you or in a mobile home park.
I hope this helps build some confidence and if you have other questions I am happy to answer just message me.
San Antonio, TX · Member since 2009 · 3k+ posts · 1k+ votes
3y
@Louie E. Yes, usually with used mobile homes financing is hard to obtain. Though, there are other ways to obtain financing to purchase these homes (i.e. seller financing, partners, private lenders, etc).
As with any business, if you can can learn the niche and fill a demand it's definitely doable. It's just a matter of studying the niche and having a good network to help you with supply and demand.
Most real estate agents do not understand the niche as they are trained in more traditional niches in real estate such as single-family homes or apartment buildings. If you can learn the niche and help other agents with their mobile home leads, you may be able to make money as long as you fill a demand.
Hello. I’ve always been discouraged by real estate agents in considering mobile homes for the reason that financing would not normally be available. Is that really the case? Where does one normally go to get financing to buy mobile homes if ever?
Thank you!
Hello Louie,
While financing for mobile homes may not always be easy to find, it is not impossible to find. There are many lenders who do such financing. It'll just be an issue of finding lenders who do such financing. Private money, maybe commercial may be ways to proceed with financing such a project
Investor · Provo, UT · Member since 2016 · 759 posts · 626 votes
3y
I am surprised that nobody has mentioned the largest lenders for mobile homes in the country.
Let me clear up a few things
1. Anyone telling @Louie E. to go to a normal mortgage lender is thinking about a double wide on land because single wides cannot be lent on with traditional financing.
2. The homes almost always need to be 1976 or newer and I believe it is like July of 1976 when HUD rules came into effect.
Here is a list of mobile home lenders:
1. 21st Mortgage (Owned by Berkshire Hathaway and in the same umbrella as Clayton Homes)
I don't like mobile homes because they don't tend to hold value, seen as trashy and attract undesirable tenants. Just my opinion.
Many do look trashy but you have to realize that tens of millions of Americans live in them and have no other choice, as investors we can change that narrative.
On valuations, I could challenge you on that. It is more dependent on the location of the home than it is the home.
I have heard this myth brought up over and over and looking at local comparables these homes have appreciated upwards of 400% since the 90's, hard to say they don't hold value or even appreciate.
A real estate appraiser said that newer mobile homes (actually they are manufactured homes not mobile homes or trailers) depreciate the same as a stick built home for appraisal purposes. Many have gotten rich off of mobile home parks and rentals. I see the market growing.