If you are looking for a manufactured home for sale near your location or if you already purchased one and want to refinance it, you will have to consider a few factors before doing so. Mobile homes or small manufactured homes are not exactly the same thing as modular homes, which mean that the terms and conditions of financing these houses also vary.
Some lenders may refuse to finance small manufactured homes, as these structures can be easily detached from the site of the homeowner and transported to another site for installation. However, if you are ready to do a little bit of research, then you will be easily able to secure financing for all the manufactured home for sale.
It is true that manufactured or mobile home loans may often contain increased fees and rates because of the risk that comes with these types of factory-built homes. Still, some financial institutions or lenders will be ready to finance the buying of a manufactured home without the need for mortgage insurance. This means that you will be easily able to avoid an FHA mortgage, which usually contains a monthly mortgage insurance payment.
However, if you have no other option, then you should consider getting an FHA mortgage. Below are a few of the manufactured homes financing options available at your disposal.
You will need a minimum of 20% down payment and a credit score of 640 or above to secure a conventional mortgage. You will be able to use a conventional mortgage for refinancing or purchasing a manufactured home, but you should consult with your financial institution and get a clear idea on the rules and regulations applicable on the loan. If you are planning to buy a manufactured home for sale near your area, then a conventional mortgage is undoubtedly the best option for you.
If you are not able to secure a conventional mortgage for financing the purchase of a manufactured home, then your best bet would be to try to secure a FHA mortgage. The Federal Housing Administration finance usually consists of two different forms of mortgage insurance, which are a monthly mortgage insurance payment and an upfront mortgage insurance fee.
It is significant to note that you can avoid the monthly mortgage insurance payment by going with a conventional mortgage. It would be wiser to consult with your mobile home manufacturer and ask for their advice before applying for a mortgage.