A mobile home loan is a loan product for the purchase of factory built homes. It differs slightly from traditional mortgages, and it has specific features designed specifically for mobile home buyers. Traditional lenders typically struggle with these type of loans. Fortunately, there are mobile home industry specific lenders that have great loan products for your new home purchase.
Site Built Homes Vs. Mobile Homes
There are two ways to classify a mobile home to lenders: personal property or real property. Traditional mortgages treat ALL dwellings like real property, but that is not true with loans for a mobile home. Lenders will only consider a mobile home as real property when it is affixed to piece of real estate (property) with a traditional foundation. When affixed to real estate, mobile homes are eligible for many of the traditional loan programs that are available for site built homes. When it is not affixed to the property, you can finance your mobile home with a chattel (home only) loan. Though different from a traditional mortgage, these loans can oftentimes have less stringent underwriting and paperwork requirements than their counterparts.
More About Chattel (Home Only) Loans
Part of the challenge of purchasing a mobile home can be securing good, affordable financing for your new home. Traditionally, options have been limited for chattel lenders, but there are many new ones coming into our industry. They have competitive rates, low down payments, and low closing costs to make your mobile home purchase as smooth as it can be.
The process is very similar to a traditional mortgage loan, except for a few key differences:
1. Time – Chattel loans will help you get into your new mobile home much more quickly than a real estate mortgage. There is no title company involved, and there are typically fewer underwriting requirements.
2. Cost – Because there are no title companies involved, buyers will not have to pay the closing costs typically charged on a traditional mortgage. And who doesn’t like saving money, right?
The bottom line is that there are many financing options available for your new home purchase. Whether you’re looking into a Chattel loan, or a more traditional mortgage route, there are plenty of options to help you finance the purchase of your new mobile home.
Here’s a quick look at the process for purchasing and financing your new home with a chattel loan.
Step 1 – Choose your home
It’s time to find your dream home! You can find your home by coming in to our sales center, or you can check out all of our inventory on this website. Hench’s has LOTS of homes to choose from, so we’re certain we can help you find your dream home!
Click here to head over to our inventory page.
Step 2 – Apply with your lender
Once you’ve found that dream home, is time to find the best lender for you. The manufactured housing industry has many chattel lenders, and we can give you the materials you need to help you find the perfect option for you. There are lenders that work with a wide range of credit scores, loan types, and homes, so we’re confident there is an option out there for you.
Want to estimate your mobile home payment? Click here for a great payment calculator from Bank Rate.
Step 3 – Submit Credit Conditions to Lender
Once your loan application is pre-approved, you will need to submit all your credit conditions to your lender. These include your W2s, pay stubs, drivers license, and others. These are the documents that the lender will use to verify the information on your loan application.
Step 4 – Close your Loan
You’re almost there! Closing the loan just means that you will come into the dealership to sign all the paperwork. There will be a lot of signing to do, but this is not a hard step in the process. Plus…you’re almost down with your mobile home purchase!
Step 5 – Dealer Delivers Home
You’ve got a delivery coming! When we’ve reached this point, it means that your mobile home purchase is nearly complete. We will bring the home to the property, and begin the installation. Depending on the complexity of the project, this can take from a few days to a few weeks. Rest assured that we want to get you in your new mobile home as quickly as possible.
Step 6 – Move in!
It’s all yours. You’ll have a final walkthrough to complete, then the home is all yours! It’s time to kick back, put your feet up, and relax in your beautiful, new mobile home.
