If you’re considering buying a manufactured home, know that you’ll be in great company among the tens of millions of Americans—to be exact, 22 million people live in manufactured homes today. These savvy home buyers know that manufactured homes are actually among the best ways to get a great-quality home at a price you can afford. Nine percent of all new single-family home starts in the U.S. are manufactured homes, making them an indispensable part of America’s homeownership economy.
This guide will take you through every step in the process of buying a manufactured home in 2020–from how to find a mobile home you love, to investigating your financing options, to the closing process. It’s certainly a big decision, but it also doesn’t have to be a difficult process, so long as you come prepared. The experts at MHVillage will guide you through every step of how to buy a manufactured home that you love.
Learning and Planning
First, you might be wondering if purchasing a manufactured home is right for you. There are some common questions that many first-time manufactured home buyers ask. We’ve listed a few here. Just click to see an article from our mobile home buyers guide that gives you the facts!
- What is a manufactured home?
- What is the average size of a manufactured home?
- What are the benefits of buying a mobile home?
- How much do mobile homes cost?
We address all of these questions and a variety of other manufactured home topics in our Explore section, where you’ll find the latest information about manufactured homes from an insider perspective. Check out our article, Everything You Want to Know About Mobile Homes for more information on the biggest questions manufactured home buyers ask.
On top of these questions, there are some other relevant factors that you should take into account from the beginning:
- Do you want to buy a pre-existing manufactured home, or do you want a new custom manufactured home?
- What’s your budget? How much flexibility can you afford to build into your budget? How much can you afford as a down payment?
- Will you own the land that your manufactured home sits on, or will you be buying only the home? (If you’re only buying a home, you’ll need to include monthly lot rent in your budget.)
- Which city and state would you like to live in?
As you’re considering what you want from your manufactured home, it also pays to begin thinking about how you’ll finance your purchase.
Manufactured Home Financing
Many financing options for manufactured homes are available. Often, they’re different from the options that are available for site-built homes, so the process for getting financing may be unfamiliar to some buyers—but millions of buyers every year can and do finance their manufactured homes.
If you intend to purchase a manufactured home or a modular home that is already placed on a permanent foundation, or one that you plan to place on a permanent foundation, you may be eligible for a traditional mortgage similar to the mortgage on a site-built home. Construction-to-permanent (CtoP) loans are a popular multi-stage loan product that finances every stage of the process of buying a new manufactured home with land, situated on a permanent foundation.
Many buyers can also get help from the U.S. government with financing their mobile home. Check these options to see which your mobile home may be eligible for:
- The Federal Housing Administration (FHA) often helps buyers secure manufactured home financing through FHA-insured manufactured home loans.
- If you or your spouse is a U.S. military veteran, your manufactured home may be eligible for a VA Home Loan.
- If you’re buying a manufactured home in certain rural areas, your home may be eligible for a USDA Rural Development Loan.
- The government corporations Fannie Mae and Freddie Mac provide many loans to qualified manufactured home buyers. Fannie Mae and Freddie Mac offer financing programs such as Freddie Mac’s CHOICEHome program, which provides more traditional mortgage loans for manufactured homes with site-built features, and Fannie Mae’s MH Advantage® program, another program aimed at manufactured home buyers.
For buyers who are buying a mobile home without land, you’ll want to look into chattel loans, the most common type of loan for home-only buyers. With a chattel loan, your manufactured home will be titled as personal property, like a vehicle, rather than as real estate. Chattel loans sometimes come with higher rates and more stringent terms than other types of mobile home financing, but they can still be a solid option for buyers who need to buy a mobile home without land.
Just like with any home, your credit and financial history will affect the type of manufactured home financing for which you’re eligible. However, it’s still possible to get manufactured home financing even if your credit isn’t perfect. For more information, check out What Credit Score Do You Need to Buy a Mobile Home?
Finding the Perfect Manufactured Home
Next, the fun part: It’s time to start shopping for a manufactured home you love! You probably want the widest selection and the best quality of manufactured homes to choose from, and MHVillage has both. MHVillage is the biggest and most active online manufactured home marketplace in America. We help sellers sell tens of thousands of homes per year, with a combined value of over $3 billion.
So, with all that selection, how can you go about making the right choice? First, here are a few basic questions that you can ask to get started on your criteria for finding your ideal manufactured home:
- What kind of floor plan would you like your manufactured home to have?
- Do you want to live in a manufactured home community? Are you more interested in senior mobile home parks, or would you prefer an all-ages community?
- Will your household require a single-wide, double-wide or triple-wide manufactured home? Will it need space for a growing family or for caring for an older relative?
- What kind of manufactured home amenities are you looking for? Do you want something with all of the bells and whistles, or a more basic model that can be upgraded later?
- Are you open to the idea of moving a manufactured home from its current location? This can allow you to transport a home that you really like to your ideal location, but it’s also quite expensive.
Once you have a basic idea of what kind of manufactured home you’re looking for, MHVillage offers several easy ways to browse manufactured homes near you. You can use our state-by-state manufactured home online marketplace to select the state and city that you’re interested in or search for mobile home dealers or mobile home parks near you.
Examining a Manufactured Home
When you find a manufactured home you’re interested in, you first want to get a good look at the manufactured home in person. If you’re looking at a pre-existing manufactured home, you can easily contact the seller through MHVillage by clicking “Email Seller” or “Call Seller” on the home’s listing page. If you’re looking for a new manufactured home, you can use our resources to contact a manufactured home dealer or find a manufactured home floor plan to tour.
It’s important to know that a manufactured home is structurally sound before you make an offer, so do your due diligence just as you would with a site-built home. In particular, you should make sure to note the information from two sources:
- The HUD tag, a metal plate typically located on the outside of the house.
- The data plate, a piece of paper that’s typically attached to the wall in a closet or cabinet.
HUD tags and data plates include all kinds of key information, including a home’s ratings for extreme weather and temperature. They also certify that a manufactured home meets all relevant HUD standards. Learn more about other important manufactured home terms and definitions.
You should also make sure to ask for the home’s inspection records. If the home hasn’t been inspected, insist on an independent inspection through a professional independent mobile home inspector such as Datacomp. An inspector will be able to spot things that you might miss, such as hidden water damage and/or structural deficiencies. Think carefully about buying any manufactured home that needs a lot of repairs, and make sure to get a seller’s disclosure statement before putting any money down.
Finally, be sure to check the title history of the manufactured home to ensure that it has no liens or unpaid taxes against it. If the seller cannot produce a title, ask them to obtain a duplicate title before you make an offer. If they are not the owner of record on the title, they’ll need to have it signed over to them by the owner of record before the sale happens.
Making an Offer on a Manufactured Home
When you’re ready to make an offer on a manufactured home, it’s easy to do it through our “Make Offer” button on MHVillage. (Note that this is just a preliminary expression of interest, not a legally binding contract.) However, there are a few key tips you should know to ensure that you make a smart and serious offer.
First, it’s critical to retain the services of a real estate attorney and/or real estate agent at this point in the process. A real estate professional will be able to guide you through the process of making an offer and creating legally binding documents for the process. (Remember that nothing in this guide should be construed as a substitute for professional legal advice.)
It’s also important to represent yourself as a serious and qualified buyer. Sellers usually require a deposit of “earnest money” before accepting an offer, which you’ll usually forfeit if you don’t go through with the sale. Remember to make sure that the seller knows what kind of financing you’ve been pre-qualified for.
Think carefully about what kind of contingencies you want to include in your offer. Some contingencies are important to protect yourself, such as a contingency for a complete inspection, but too many contingencies can make your offer seem unreliable. Ask your real estate professional which contingencies are essential to include.
Closing on a Manufactured Home
The closing process for buying a manufactured home, in which the buyer receives the keys and the seller receives payment, is generally similar to that of any other home. The closing process can commence as soon as the buyer’s application for financing is approved and any other contingencies of the offer are satisfied. Today’s closings often don’t even have to happen in person. Paperwork and escrow funds can often be exchanged through electronic means.
Typically, closing involves the following elements:
- Signing of mortgage documents, such as your promissory note and deed of trust
- Transfer of funds to cover the down payment, closing costs and any other necessities
- Signing of closing disclosure
- Providing homeowner’s insurance and inspection documentation
- Distribution of funds from the lender
Here are a few tips to make sure that your closing and loan approval go smoothly:
- Pull your credit report before beginning the process and make sure any errors have been corrected.
- Get a conditional approval (the next step after pre-approval) to help your loan close more quickly.
- Try not to make any other large purchases on credit or do anything else that can ding your credit score while waiting for loan approval.
- Make sure you have major financial records such as income statements and tax documents available when they’re needed.
Moving In and Getting Settled
Oh, happy day! You’ve closed on your manufactured home and are ready to get your family moved in. However, there are a few more considerations and steps to take before you settle into domestic bliss.
Are you moving your manufactured home from its current location? Then you’ll need to know the basics of moving a manufactured home, including how to obtain a permit for moving a home, how to calculate the costs of moving it, and how to find a qualified professional manufactured home mover. If you’re getting a custom-built manufactured home, the builder will work with you to arrange the delivery through their transportation partner.
Homeowner’s insurance is also just as important for manufactured homes as it is for site-built homes. MHVillage offers free quotes on manufactured home insurance through our wide network of specialized mobile home insurance products. Likewise, security is critical for a safe and comfortable manufactured home, so make sure to check out our guide to manufactured home security essentials.
MHVillage is your one-stop source for every stage of the process of buying a manufactured home. We have the resources to help you research, choose, finance and close on the perfect home—and it’s all just a click away!