More information about FHA financing is available at FHA Loan Advice.
Purchasers of manufactured homes often use short term financing from a bank (for example, a five year balloon note) or short term, high interest rate owner financing to cover the cost of setting up their new home. Since each of these methods of financing the manufactured home must be paid off in a short period of time, owners of manufactured homes should begin looking for replacement financing as early as the end of the first year. The end of the first year is the beginning of the time that the loan can be based on the appraised value of the home instead of its original sales price.
Although FHA has fairly stringent guidelines for manufactured homes, a loan officer experienced in this area can guide borrowers through the effort with no more hassle than a traditional mortgage. The major advantage of an FHA loan for this purpose is that an FHA loan gives the best chance to take advantage of today's low mortgage rates rather than higher conventional rates for manufactured homes.
An FHA loan for a manufactured home has all the same attributes of any other FHA loan, including the option for streamline refinances should interest rates go down. If the property meets the requirements, the loan is processed just like an ordinary FHA loan.
In the next installment, we'll explore some of the additional property requirements and processing requirements for a manufactured home and how they affect the processing flow.
A free First Time Home Buyer Guide is available here.
Carl Pruitt is a 22 year veteran of the mortgage/real estate industries who specializes in FHA mortgages
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Carl,
Thank you for the information! I did not know you could finance manufactured homes with FHA. All I know about manufactured homes is that it is hard to finance. There are not many manufactured homes in my immediate area, but just outside of town there are tons of them. I look forward to read more of your posts. Thanks again!