Manufactured Housing Product Matrix Fannie Mae
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For more information, use our mortgage education center or read details on our loan programs. Whether you are purchasing a new single wide mobile home or refinancing an existing loan, at eLEND we work hard to keep the financing process simple and affordable. Manufactured homes are subject to construction and safety standards put in place by the U.S. HUD’s Manufactured Home Construction and Safety Standards regulate thermal protection, plumbing, electrical, fire safety and more.
This means buyers should not rely on an appraiser to notice structural problems or any other defects with the home. For their own peace of mind, buyers should order an independent, third-party home inspection to make sure they’re not purchasing a surprise fixer-upper. In this case, your lender might require a specialist to check out that issue. For instance, chipping paint on the exterior of an older home might trigger a note from the appraiser that area should be checked out by a lead paint specialist.
Mobile home loan FAQ
And some lenders charge origination fees as high as 6 to 7 percent — higher than the average mortgage loan’s closing costs. A chattel loan offers an in-between option for mobile home financing. This loan resembles an auto loan in that the home serves as collateral for the loan. The interest rate is fixed for the entire loan term, and there are maximum loan amounts based on whether you’re financing a home purchase, buying the land for the home site, or both. There are a few different loan options if you can’t get traditional mortgage financing for your mobile home. As with Freddie and Fannie loans, you may need to shop around to find a lender that underwrites FHA Title II manufactured home loans.
This coverage protects the lender in case you default on the loan. Mortgage insurance premiums will add to your monthly payments and upfront costs. These premiums also lower your interest rate, so they may save you money. Once you’ve decided on a loan type, it’s important to research the pros and cons of each lender that you’re considering when shopping for a mobile home loan.
What Do Manufactured Homes Cost?
In addition, a home appraisal is typically required to verify the property’s value. These homes can still be financed, just not with home mortgages. Low-income home buyers (who earn 80% or less of their area’s median income) can get loans directly from the USDA.
The loans work almost exactly the same as financing for traditional “stick-built” houses, though you can expect to pay higher interest rates. If your manufactured house meets the guidelines above, you may be able to finance it with a traditional home mortgage. Most likely, that’s a Fannie Mae, Freddie Mac, or government-backed mortgage program. Manufactured homes are built in a plant and transported and placed on a permanent foundation. There are a few disadvantages to keep in mind when getting an FHA loan. And remember that FHA mortgages will require mortgage insurance, both up front and annually, and often for the entirety of the loan term.
Ready to buy or refinance a manufactured home?
HUD notes that while it is the only agency with this requirement, most lenders also follow its guidelines. A HUD tag shows the home meets safety and livability standards, so it’s a good thing to have. For example, borrowers could get financing even if the home is less than 400 square feet and built before 1796.
In fact, mobile homes offer a variety of floorplans and amenities, including fully equipped kitchens and spacious bedrooms. A mobile home refers to manufactured homes produced before June 15, 1976. Mobile homes received a bad reputation thanks to early models, which often werent built with quality in mind and depreciated in value quickly. While mobile home is a dated term, it continues to be used in reference to manufactured homes.
Atlantic Bay Mortgage Group, L.L.C. disclaims any obligation to publicly update or revise any views expressed or information given. All loans subject to income verification, credit approval and property appraisal. Atlantic Bay Mortgage Group, L.L.C. NMLS #72043 (nmlsconsumeraccess.org) is an Equal Housing Lender.
It’s possible to finance with no money down and no mortgage insurance, as long as you meet the lender’s credit and income requirements. Another financing option is a chattel loan, which actually is not a type of mortgage but a personal property loan. Chattel loans are designed specifically for movable property, which is what the term “chattel” means. “Chattel loans are usually used when the mobile home will be located in a park or a manufactured home community, and they are home-only loans, excluding the land,” Andreevska says.
If you are only buying the manufactured home and not the land underneath it, another option is to take out a personal loan. Personal loans can be secured or unsecured, meaning they’re backed by collateral or not. Personal loans tend to have higher interest rates and a much lower loan cap than a traditional home loan.
Personal loans can have higher interest rates for those with poor credit (north of 20%, in some cases). However, in areas where more people own mobile homes, its probably easier to find financing. The darker areas in the map below indicate areas with a higher percentage of manufactured or mobile units. You may also be able to rent land in a manufactured home community or mobile home park, though youll want to look carefully at the terms and costs of that as well. Make sure its affordable, because you may find youre better off purchasing land yourself after all.
This is an umbrella term that covers all types of homes made in factories, including manufactured, modular, concrete, kit, panelized, and log homes. For one thing, the land and the manufactured home are already paired, and the property may already be on record as a real estate property. A modular home is built in a factory but delivered in pieces and assembled on site. It’s placed on a permanent foundation and often includes a porch or a carport.
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