Colorado Nonprofit Offers Loans For New Manufactured Homeowners

MH industry terms
A new home from Adventure Homes.

Durango-based Nonprofit Assists New Home Owners with Financing

HomesFund, a nonprofit based in Durango, Colo., is using a $600,000 grant to make manufactured home ownership possible for residents of La Plata County, an area where housing prices have been skyrocketing.

Manufactured and mobile homes are the nation’s only subsidy-free affordable housing. And with housing in Colorado a hot commodity, those wishing to purchase a manufactured home could use a leg up.

HomesFund seeks to give people financial and educational opportunities that break barriers to home ownership. Their mortgage assistance program has helped people in southwestern Colorado purchase both site-built and manufactured homes since 2008.

Manufactured Home Loan
A Google Earth satellite image of Durango, Colo., where the topography and natural draw of the area tends to increase home prices. At the center of the image with the red pin is Durango Fountain, an all ages community.

Colorado Has Some of the Nation’s Most Pricey Housing

Stick-built homes in La Plata remain financially out of reach for large percentages of potential homeowners, HomesFund Executive Director Lisa Bloomquist Palmer said. And site-built homes that are more affordable often are far from job centers. This makes manufactured home communities a much more viable option.

That’s why HomesFund launched its new manufactured home loan system, exclusively for manufactured homes. The program began in the second quarter of 2018.

The company originally allocated $350,000 for the program, but has since validated $600,000, thanks to the Community Development Financial Institution Fund. This amount will help eight to 11 buyers in the next three years with manufactured home loans of $20,000 to $75,000. They are now accepting applications.

“Those in MH face many challenges,” Bloomquist Palmer said. “Financing is one problem we can do something about.”

Manufactured Home Loan
The interior of a new Sunshine home.

Finance Options Remain Limited for Manufactured Housing

This program is particularly helpful because manufactured homes aren’t considered real estate but personal property, unless a homeowner also owns the land beneath them, which is a rare occurrence.

This matter rules out real estate loans and narrows the options for potential homeowners.

What sets HomesFund apart from other lending organizations is that they forgo the large interest rates and cash down payments lenders often require, according to Bloomquist Palmer.

Unlike nearby Colorado counties, people from many economic backgrounds call La Plata home. And Bloomquist Palmer thinks it’s important to keep it that way.

“We want to have an inclusive community in La Plata County,” she said. “If everyone who was middle class moved away because they can’t afford to live here, we would have more congestion and people would spend more time away from their families.

“Aspen and Telluride are exclusive and expensive. Part of the appeal of Durango is that we have a strong middle class,” Bloomquist Palmer said. “We are a place where people really live and it’s very apparent that people of all incomes can live here.”

Manufactured Home Loan
A new manufactured home from Champion Homes.

Qualifications for a Manufactured Home Loan Through HomesFund

However, HomesFund’s loan application does have some requirements. The nonprofit has yet to give out a manufactured home loan.

“Our funders demand that we have income restrictions,” Bloomquist Palmer said.

Requirements include having an income 80 percent of the area median income or below and being able to demonstrate they can afford a home once they have it. HomesFund looks at potential homeowners’ debt-to-income ratio, duplicates of credit and other factors. It also asks that people have a history of being in the area. Applicants can learn more on the website.

The loan is for people purchasing manufactured homes in communities. HomesFund has other mortgage assistance programs for fixed manufactured housing. Bloomquist Palmer said they have requirements for communities as well.

“We want to make sure that the homes we earn money on are in approved communities,” she said. “They need to be safe and habitable, need to have certain rules and there can’t be any problems with sewer and electricity.”

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