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What are my loan options for a manufactured home?

If you’re in the market for a manufactured home, you’ll want to consider all of your loan options prior to picking out your dream home. Mortgage loan options for manufactured homes differ from those for traditional site-built homes in some ways, while in some cases you may be able to take out a conventional loan. Prefabricated homes can be budget-friendly, while allowing you to increase their value by adding outbuildings, placing it on a foundation, or owning the land. What are the loan options for a manufactured home?

What Is a Manufactured Home?

Often when talking about manufactured homes, it refers to a prefabricated home. There are two main types of prefabricated homes that qualify for loans.

A manufactured home is a home that is built off-site and then transported to the place where you will live. Prefabricated homes are transported to their final destination in one or more sections. Options include a single-wide, double-wide or a multi-wide. A single-wide will be no longer than 18 feet wide and 90 feet long while in transportation mode, while a double-wide will be a minimum of 20 feet wide and a maximum of 90 feet long. A manufactured home is often placed directly on the land, making it a temporary placement.

A modular home differs from manufactured homes in that it’s placed on a permanent foundation, making it a permanent fixture on the land. You may already own the land you place the modular home on or include it in the loan for your modular home.

What Are My Loan Options for a Manufactured Home?

There are a few different options for manufactured home mortgage loans, depending on the type of home and placement.  The programs we will go over here are:

  • Chattel Loans
  • FHA Loans
  • VA Loans
  • Conventional Loans

Chattel Loans

For a single-wide, double-wide, or multi-wide manufactured home that will be placed on the land without a permanent foundation, you have the option to take out a chattel loan to cover the structure. Chattel loans cover property such as machinery, vehicles, and manufactured homes. A chattel loan covers the home only, so if you already own land or have family land to place your home on, this is a great option for you. A chattel loan may also be used if you plan to place your manufactured home in a mobile home park.

Cascade Financial Services offers chattel loans with competitive rates. Requirements include:

  • Minimum credit score as low as 575 in some cases.
  • Loan amount of $35,000 to $150,000.
  • New single-, double-, and multi-wide manufactured homes.
  • Down payment as low as 5%.
  • Debt-to-income ratio as high as 50%.
  • Terms of 20 to 25 years.

To qualify, you also cannot have had a vehicle repossessed within the last 24 months and have no collection account greater than $1,000 opened in the last year. All active past due accounts must be made current prior to close. 

FHA Loans

If your home will be attached to a permanent foundation, you may qualify for an FHA loan to finance your manufactured or modular home. These loans offer a lower required down payment, as low as 3.5%, and you can often qualify even with a lower credit score. The debt-to-income ratio will be based on a variety of factors including total income dedicated to housing, past credit history, residual income, and more. Requirements include:

  • Home was built after the new Department of Housing and Urban Development guidelines of June 15, 1975.
  • Red HUD label is affixed to each section.
  • Minimum of 400 square feet of livable space.
  • Home is set on a permanent foundation that meets FHA standards.
  • Home must be used as owner’s primary residence.
  • Must meet the Model Manufactured Home Installation Standards.
  • Lot must be designated and approved.

VA Loans

A VA loan is guaranteed by the Veteran’s Administration and funded by a private lender authorized to provide VA loans. VA loans are meant to honor American military members and their families by providing affordable housing options that are easier to secure. Special rules and regulations for VA loans include:

  • Lender determines interest rate, and at Cascade Financial Services, we offer great rates similar to our FHA loans.
  • Loan can be for 100% of the home value, meaning $0 down payment.
  • Required VA funding fee, that may be waived for a disabled veteran.
  • No monthly mortgage insurance requirement.
  • Minimum credit score of 620, however, Cascade may still be able to qualify you below this threshold in some cases.
  • Any foreclosure or bankruptcy must be post-two years to qualify.
  • VA selects home appraiser.
  • Veteran must occupy the home as their primary residence.

VA loans are available to service members after 90 days of service at wartime, 181 continuous days of service in peacetime, or six years of service in the National Guard. Spouses of veterans who died during service are also eligible.

Conventional Loans

A Conventional Loan can be a great option for someone with relatively strong credit and a larger down payment.  Typically, the biggest benefit with a Conventional Loan is a lower monthly mortgage insurance payment or none at all if there is at least a 20% down payment on the purchase of a home.  

  • Minimum credit score as low as 640; generally recommended 680.
  • Home must be permanently attached to a foundation.
  • New single-, double-, and multi-wide manufactured homes.
  • Down payment as low as 5%.
  • Debt-to-income ratio 43%, although there may be exceptions.
  • Terms up to 30 years.

How Do I Secure Financing for my Manufactured Home?

Regardless of the type of loan you apply for, there are a few key steps to securing financing for your manufactured home, including:

  • Income. You must be able to prove your current income through pay stubs and tax documents. Review your income to ensure that your budget allows for a monthly house payment, utilities, and other expenses related to homeownership.
  • Credit. Check your credit history and credit report to make sure no errors are present. Lenders will check your credit report for accounts, payment history, balances, and public records such as bankruptcies.
  • Loan type. Once you’ve settled on chattel, FHA, VA or Conventional financing for your manufactured home, be sure to check the terms, including funding fees, loan limits, closing costs, loan origination fees, interest rates, and credit score requirements.
  • Lender type. Find a lender you’re comfortable working with and who works hard to get you the financing best suited for your needs. You may want to select a lender specializing in financing manufactured homes, such as Cascade Financial Services.

When you’re ready, you’ll go through the approval process, which includes prequalification, preapproval, contract, underwriting, and closing. If you’re applying for a VA loan, the lender will also verify your eligibility for the VA program.

If you have questions about loan options for a manufactured home or want to see if you qualify for one of these loan options, reach out to Cascade Financial Services. You can contact us at 877-869-7082 for questions or information regarding the application process. We also offer a convenient online prequalification option for those interested in applying for a loan.


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