Your Guide to Manufactured Home Loans

What is a manufactured home loan?

A manufactured home can provide the stability and comfort of a traditional home but at a much lower price. Manufactured homes are homes built at a factory—not on a property. After being built and inspected, the home is shipped on a truck to a property for installation (not quite same-day shipping, though).

Manufactured homes generally require specific financing programs that are not offered by all lenders— that’s where we come in! At Treadstone, we have multiple options available for manufactured homes.

 

Requirements

General requirements for Manufactured home loans:

• Purchase only
• 30-year term
• Minimum credit score of 580
• Property must have the title available or have been converted to real property
• Home must have an Engineer’s Certification Report
• HUD tags must be attached (all manufactured homes have two labels/tags on the exterior)
• 5% minimum down payment
• Must be built after June 16, 1976
• Must be on land (not in a mobile home park)
• Home cannot have been moved— must remain on original foundation & location
• Home must be fixed properly to its foundation

 

Types of loans for manufactured homes

Conventional

Conventional loans are an all-encompassing type of home loan. Conventional loans can be used by homeowners for many property types, including manufactured homes.

The minimum down payment with a conventional loan for a manufactured home is 5% down.

 

FHA

FHA loans are an excellent choice for manufactured homes. FHA’s requirements for income & credit are slightly more extensive, compared to other programs, but the minimum down payment available on FHA loans for manufactured homes is 3.5%.

 

VA

VA loans are backed by the Department of Veterans Affairs and are exclusively offered to veterans and active-service military. VA manufactured homes are eligible for 100% financing like regular stick built homes.

 

RD

RD / USDA Loans are reserved specifically for homes in rural areas, as defined by the U.S. Department of Agriculture. Additionally, they may only be used for primary home purchases. USDA Loans for manufactured homes have a minimum down payment of 0%.

To use a USDA or RD Loan for a manufactured home, the home must be brand new (not older than 12 months). Additionally, the unit must have at least 400 square feet of floor space and must be placed on a permanent foundation.

In certain cases, some requirements may be waived. Check your eligibility!

 

Can I buy a manufactured home with 0% down?

Yes, it is possible to buy a manufactured home with 0% down! You’ll need to get crafty with your Loan Officer to find what works best for you, but Treadstone has plenty of programs to help you purchase a manufactured home with 0% down, or with as little money down as possible.

 

Manufactured home financing with bankruptcies or foreclosures

It is absolutely possible to purchase a manufactured home loan with a past bankruptcy, foreclosure, or short sale.

If you’ve had past financial hardship that you’ve been working on fixing, check out our resource on buying a home with past bankruptcies or foreclosures, and talk one of our Loan Officers to see if you’re eligible.

 

Things to consider when buying a manufactured home

Location

Which suits your needs better: suburban or rural? You may have a low down payment with either, but with a more rural home, you may be able to leverage a USDA/RD Loan.

Size

Some loan programs for manufactured homes have different requirements or restrictions for single-wide and double-wide homes. For example, the manufactured home must have a living area of no less than 400 sq ft for a single-wide or 700 sq ft for a double-wide.

New/Used

Many manufactured home loan requirements include how new the home is, or what condition it is in. You’ll need to seek a home to fit your loan program, or vice versa. Your loan officer will be able to strategize with you!

Credit score

You’ll need a minimum credit score of 580 before buying a manufactured home! Be sure you minimize negative impacts on your credit before getting a manufactured home loan, by avoiding excessive credit inquiries and paying your bills on time.

Frequently Asked Questions

How are loans different for manufactured homes?

Many of the same programs may be used for both manufactured homes and site-built homes. There are simply additional requirements for manufactured homes.

Are manufactured home mortgage rates higher?

Your specific mortgage rate is based on your credit profile, income strength, down payment, property features, and more. To get an idea of mortgage rates for your options, let us know!

What’s the difference between mobile homes and manufactured homes?

Mobile homes are manufactured homes built before 1976, while manufactured homes were built after 1976. Manufactured homes are regulated by the U.S. Department of Housing and Urban Development; starting in 1976, HUD started regulating the safety and manufacturing of mobile homes. Legally, these homes are referred to as manufactured homes, but “mobile home” is still a casually-used term.

 

What’s the difference between manufactured homes and Modular homes?

Both types of homes are built in a factory setting, but modular homes are usually customizable, are placed on top of a basement or crawl space, and often are indistinguishable from homes built on-location. On the other hand, manufactured homes are typically delivered as a single or double-wide format with a standardized layout, and do not require a permanent foundation (meaning they can be moved). Modular homes are not built to HUD construction code, cannot be moved from their foundation, and may be legally considered a traditional single-family home.

In general, all modular homes are manufactured homes, but not all manufactured homes are modular homes.

Recap

Loans for manufactured homes in Michigan are a great way to fast-track your path to homeownership. As long as your future property can fulfill the requirements for Treadstone’s manufactured home loans, you’ll be a homeowner in no time!

How to Start

Ready to become a homeowner? The first step is simple—get in touch with the loan officer of your choice, or shoot us a call or message!