If you're considering a move to the Dallas area, you may want to consider a manufactured home as an affordable housing option. Today's manufactured homes are built with modern design and stylish fixtures and appliances, making them almost indistinguishable from traditional stick-built homes. A manufactured home is an excellent option for anyone just starting out, retiring, or wanting to save money on housing. If you opt for a manufactured home, you'll have a variety of financing and refinancing options, including VA loans if you qualify.
A manufactured home is a type of prefabricated home. Prefabricated homes are built off-site, often in a factory-type setting, and then transported to their final destination where final construction takes place. Final construction includes connecting the home to electricity and sewer, along with any final pieces that need to be attached. Manufactured homes must meet strict safety standards and construction criteria put forth by the Department of Housing and Urban Development as of June 14, 1976. If the home does not meet these criteria, including a label attached confirming that it meets the requirements, it will not qualify for a VA loan.
Prefabricated homes also include modular homes, which are largely manufactured off-site, then assembled on-site on a permanent foundation. Modular homes can qualify for conventional mortgages because they are considered permanent fixtures of real estate.
A manufactured home must be a minimum of 40 feet in length and at least 8 feet wide when in transportation mode. You can purchase single-wide, double-wide, and multi-wide models of manufactured homes. The manufactured home must have a minimum of 400 square feet of livable space to qualify for a VA loan.
The Veteran's Administration authorizes lenders to provide VA loans to honor those who have served in the U.S. military with affordable options for homeownership. The VA backs these loans, making them appealing to lenders because the loan is guaranteed to be repaid. VA loans can be both fixed-rate and variable-rate and can be used to refinance existing mortgages for an interest rate reduction or other reasoning. To qualify for a VA loan, you must have served for the following limits:
The spouse of a service member who died in the line of duty is also eligible for a VA loan through an authorized lender. To qualify for a VA loan, you must receive a Certificate of Eligibility from the VA. You can find more information, as well as apply for this certificate, on the VA website.
Service members will typically receive lower interest rates and require lower down payments on a VA loan versus a traditional mortgage, making them affordable options for financing a manufactured home. VA loans also don't require monthly mortgage insurance, which gets tacked on top of the mortgage payment on conventional mortgages that lack the 20% down payment. You will need to make the manufactured home your primary residence in order to qualify for a VA loan.
A VA loan can cover up to 95% of the total purchase price of your manufactured home. Modular homes may be eligible for 100% financing. The VA collects a required funding fee on all VA loans to help offset the program's costs. That fee can range from 1.4% to 3.6% of the total purchase price. The VA may waive the funding fee if the service member is permanently disabled.
Private lenders, such as a bank or mortgage company, can offer VA loans in Dallas if authorized by the Veteran's Administration. Not all banks and mortgage lenders offer VA loans on manufactured homes, even if they offer VA loans on traditional stick-built housing. Before starting the process, you'll want to determine whether or not the lender offers VA loans for manufactured homes. Cascade Financial Services provides a number of loan options for manufactured housing, from chattel to FHA and VA, for Dallas residents.
The first step in the qualification process for a VA loan is to obtain the Certificate of Eligibility from the VA. Once you have this certificate in hand, you can take it to any authorized lender, such as Cascade Financial Services, to begin the loan application process. The application process for a VA loan is similar to that of a conventional mortgage after that. Steps include the following:
You can use online mortgage calculators to help you determine what to expect as a monthly payment on your VA loan by plugging in the interest rate, term, and amount borrowed.
When you're ready to start down the path to homeownership, or refinance your manufactured home in Dallas, Texas, reach out to the knowledgeable team at Cascade Financial Services. We'd be happy to answer any questions you may have about the types of loans we offer, the terms and conditions of these loans, and help you determine the loan option that best fits your needs. You can also start the application process online to become prequalified and one step closer to owning your own home.