People who want to buy a home or the land for it have a number of mortgage loans and program options available for them. Manufactured homes depreciate fast and do not last as long as traditional homes. As a result you may have to pay a higher interest rate on them with the exception of guaranteed manufactured home loans.
People generally tend to buy manufactured homes with personal loans. This means that such homes are treated as personal property rather than real estate. If you do not own the land on which your manufactured home will sit, you will get a chattel loan. The bad part of this is that you will not get any real estate tax breaks as your manufactured home is not considered to be real estate.
You can expect to pay a down payment of as low as nothing. However, the higher the amount of down payment, the lower the interest charged. You may qualify for a longer loan period especially if you own the land on which the home will stand, however generally the loan period is about 10-15 years – less than a traditional home mortgage.
If your home is not mobile you may qualify for a traditional real estate mortgage rather than a personal property loan.
80/20 loans are loans on which you pay at least 20% as down payment. Your monthly payments tend to be low since you will not be paying Private Mortgage Insurance that protects the mortgage company in case you default.
As the amount you owe on the loan reaches 80% contact your mortgage company to stop charging you PMI as it becomes unnecessary.
Qualified veterans can buy manufactured homes with VA guaranteed loans. These are fantastic loans to have since they are guaranteed by the federal government, no down payment is required and the interest rate is lower. You will not be able to get a 30 year mortgage like other manufactured home loans. If you are a veteran looking to buy a manufactured home, you must consider VA loans.
Another type of loan is the FHA (Federal Housing Administration) loan. The FHA is part of the HUD (Department of Housing and Urban Development). This government body tries to get people into their own homes by insuring private loans issued for new and existing housing. Regardless of credit score people with an FHA loan have to pay the same rate of mortgage interest rate. This is the main benefit of this type of loan