How To Finance Manufactured Homes

This guide covers manufactured home mortgage guidelines. We will discuss qualifying for manufactured home mortgage loans.  Manufactured homes are built at a factory and delivered to a destination. Gustan Cho Associates are mortgage lenders licensed in 48 states, including Washington, DC, Puerto Rico, and the U.S. Virgin Islands.

We have a national reputation for being a one-stop lending shop. Gustan Cho Associates has no lender overlays on government and conventional loans.  Many of you know this by now, but you may not know that we offer mortgages for manufactured homes.

Most lenders across our nation do not offer mortgages on manufactured housing. There are a few reasons behind this. In this blog, we will discuss what a manufactured property is, how to obtain mortgage financing for a manufactured property, and what loan programs are available for manufactured homes.

Manufactured Homes Versus Stick Homes

A manufactured property is not confused with a mobile home or RV (Recreational Vehicle). A manufactured home is prefabricated housing that is mostly assembled in factories and transported to the home lot.

The United States Code of Federal Regulations, 24CFR2380, states manufactured homes are built as dwellings have at least 320 ft.² in size with a permanent chassis.

Manufactured homes are built in a factory under federal building codes administered by the U.S. Department of Housing and Urban Development (HUD).

Manufactured Home Guidelines on Eligible Properties

The federal manufactured home construction and safety standards, commonly known as the HUD code or HUD tag, went into effect on June 15, 1976. That is why many lenders (including Gustan Cho Associates) cannot lend on a manufactured home built before June 15, 1976. This HUD code created building standards to ensure the integrity of design and construction, fire resistance, energy efficiency, and overall quality code. Manufactured homes can come in one section or multiple sections.

Benefits of Stick-Built Versus Manufactured Homes

Manufactured homes were originally designed as an easy way to relocate your family. They would require being put on wheels and transported to a new location. Manufactured homes have come a long way since then. Many are manufactured homes that look identical to stick-build properties. Newer manufactured properties, particularly doublewides, are built with much higher building standards. This has allowed manufactured homes to maintain their value.

Why Are Manufactured Homes Popular Among First-Time Homebuyers

Believe it or not, millennials and baby boomers are interested in manufactured properties. Baby boomers love these properties for retirement age when it’s time to downsize.

Millennials love these properties because they are grappling with student loan debt and other high-interest debt. A manufactured home is usually cheaper than a stick-built property.

There are many ways to customize and build a manufactured home. Or you can buy a pre-existing manufactured property. Many real estate professionals commonly confuse manufactured homes with modular homes. Call us today for more information.

How To Secure Financing on Manufactured Homes

You must send in assets and income documentation and complete an online application. You must send in your bank statements, pay stubs, W-2s, tax returns (not always needed), and driver’s license or state ID. Those documents and the online application will allow the loan officer to get you pre-approved to buy a manufactured property. Now that you have been pre-approved, you will shop for your manufactured property.

Types of Financing Available on Manufactured Homes

First, we must set a few ground rules. To qualify for mortgage financing through Gustan Cho Associates. A manufactured home must be constructed after June 15, 1976. It must also be considered true “real estate” on a PERMANENT CHASSIS.

The home may not have been previously installed or occupied in a different location. Must be up to date with all codes by HUD. The property may not be single-wide. It must be double-wide or greater.

You must also own the land; a leasehold estate or park fee is unacceptable. Please call us for more details. There must be a HUD data plate, often called a compliance certificate. This is usually mounted to the manufacturer’s property and contains vital information such as the manufacturer’s name, model name, manufactured year, and serial number. Please see the HUD FAQ PAGE for more details. Assuming the manufactured property you have selected meets the information above, you will have an extra step through the mortgage process.

Manufactured Homes Mortgage Guidelines in Engineering Certification Required By HUD

When purchasing a manufactured home, an engineer certification on foundation compliance is required. There are certain instances where you do not need an engineering certificate. Such as if a home is currently a HUD REO or an FHA to FHA/VA to VA refinance loan. In certain cases, our investors will allow the previous engineer certificate to be used if that certificate is less than five years old. Restrictions apply, and the appraisal must be passed on to write a review. Besides the structural engineer report, the qualifications are similar to your everyday stick-built mortgage financing.

Mortgage Guidelines on Manufactured Homes

So, you found a manufactured home that is up to date with building codes. Now, you need a mortgage. You may utilize a Conventional, FHA, VA, or USDA mortgage loan to buy or refinance a manufactured property (NON-QM loans are unavailable). Gustan Cho Associates offers MANUAL UNDERWRITING on manufactured homes. While most lenders do not offer loans on manufactured housing, we are incredibly aggressive. Each agency views manufactured homes use differently. Please call us today to go over specifics on each loan type. 

Homeowners Insurance on Manufactured Versus Stick-Built Homes

When weighing your options with manufactured properties, remember that homeowner’s insurance is more expensive on a manufactured home than on a stick-built property. In general, a stick-built structure is stronger against extreme weather conditions. Heavy rains and strong winds can damage manufactured homes. Since manufactured homes typically have more insurance claims, the insurance premiums are more expensive.

Qualifying For a Mortgage With a Lender With No Overlays

Gustan Cho Associates is here to help you buy a manufactured home. We are mortgage lenders licensed in 48 states with more loan programs than most banks offer. If your current lender has turned you down, call us. We work with many families for up to 12 months before they qualify for the home of their dreams.

Our highly skilled staff is up-to-date on all mortgage guidelines. We look forward to helping you purchase your next home or refinance your current home. If you do not qualify today, we will personalize a financial plan to qualify as soon as possible.

Mortgage financing is not much different when buying a manufactured home versus a stick-built property. There are a few extra steps involved. If you want mortgage financing for a manufactured home, contact the team at Gustan Cho Associates at 262-716-8151. Or text us for a faster response. You can also email us at gcho@gustancho.com. The team at Gustan Cho Associates is available seven days a week, evenings, weekends, and holidays.