Manufactured homes, not always affordable living!

I agree completely.

I don't understand what these people are thinking.  Why in the world would you want to put your money into someting that is going to depreciate.  I just don't get it.

Joey... You could become very popular in our town!  We are having extreme difficulty financing mobile homes (older than 1976).    Please... do tell me more. 

As for the cost of putting up a MFH:  I think the dealers lure people in with the small cost (of the actual structure).  They don't outline and add up all of the set-up fees until after the buyers are deep into the transaction.  My humble opinion. 

Shari: excellent blog and a well deserved golden star! woot woot!

Yes, the financing on manufactured homes are very difficult.  Being a mortgage professional in Fairfield County, Connecticut and working for Countrywide Home Loans, largest lender in the United States, we do not finance mobile homes but manufactured homes are sometimes possible with some tricks I learned accidentally in the years in the business. 

I enjoyed just looking at your profile on Active Rain as well.  Good stuff Shari!

Your Mortgage Man,

Nima

also, from what I have read and seen, most manufactured homes do not go up in value, they actually normally decrease in value.  The best way to purchase one is to buy one that is 3-5 years old that has already taken the hit. 

 

 

We have the mobile home salespeople here that tell clients to call agents to get a piece of land to set it on and mislead them as to the cost of that.  These people think they are going to get an acre or two for $2000.  When you tell them what it's going for they get very upset.  If I just had a dollar for everyone who has contacted me trying to get out of a mobile home, too....

If you are buying mobiles personally to sell my understanding is they are called trailers, until you want to sell them, then they are called mobile homes.

Okay more information is in order.

Shari: You picked a great topic!  It looks like a lot of people have something to say.

Trailers vs Manufactured Homes vs. Modular, etc

According to Freddie Mac and Fannie Mae, the two largest investors in conventional mortgage notes, the guidelines (and every major lender uses these guidelines, although they may be more restrictive if they don't feel up to underwriting these properly) for manufactured homes are as follows:

• Built on or after June 15th, 1976
• On it's own land
• Have access to roads, utilities
• Be taxed as Real Estate
• Be on a permanent foundation
• The axle has been removed
• Be at least a double wide...unless it's in a PUD

What is the difference between a manufactured home, a mobile home and a modular home?

The mobile is built before june 15, 1976.  It's that simple.  HUD determines it, and every Manufacture Home has a HUD tag (DON'T REMOVE IT EVER!)

FHA is a bit more restrictive...it has to not only have a permanent foundation but also have it recorded (a 433a) and it can NOT be moved after it is place on the land.

The main distinction between modular and manufactured is simply your local codes.  Common distinction is the type of chassis it is built on and delivered with.  And conventional guidelines treat a modular home EXACTLY THE SAME AS A STICK BUILT. 

Don't believe the hype.  A well-built manufactured home is sometimes constructed better than a stick-built home, plus it's cheaper.  When you build in a factory, there are less injuries, delays because of weather, and cheaper worker's compensation insurance than building on site.

I HIGHLY recommend that you Google Richard Heyn, SRA.  He's a sought after expert by the NAR and, for a fee, your association can have him come teach an excellent classz for Realtors.

I only do residential mortgages in California, but any Realtor that has questions is welcome to use me as a resource.  Take care!

Oops...a comment on appreciation...

An average manufactured home on a half-acre has gone from about 60k to 260k over the last six years.  Perception obviously affects price, and manufactured homes have not appreciated as much (in dollars), but at nearly the same rate as stick-built homes.

Joey,

So they have gone up 56% per year over the past six years!  I really find that hard to believe.

It sure hasn't in Indiana, things today are worth about what they were six years ago, any property, whether it was manufactured or normal construction.

I do agree that they are built as well or better then homes on regular foundations...

 

Here's my  differentiation between the three:
Trailers:  Old (pre-1976) single wide mobile homes on leased land
Mobile homes:  manufactured homes on leased land. 
Manufactured homes: manufactured home attached to land

 

Hi Craig,

Yes that sounds incredible, and perhaps 'an average manufactured home" was a bit strong...or implied hard research.  I'll tell you this, appreciation in my area was approximately 36% per year for the last half decade, and that included manufactured homes.  When I started in this business, a manufactured home over $100k was unheard of.  Now, a man hm on .5 acre under $250k is hard to come by (unless it's run down).  Only with the recent softening of the market is it possible to find any decent place in a good neighborhood under $250k.  Again...that includes manufactured homes.

You're Indianapolis, right?  I have a great friend that just moved to Mooresville.  He bought his home around 2002 for $89k, added a couple bedrooms and a bath, and sold it for $289k last summer.  It was that crazy out here.

The problem here is that saying "manufactored home" is about like saying "car" and then giving your reasons for not purchasing a particular class of cars.

There are the traditiona single/double wides that are what most are talking about.

But then you have pre-facbricated homes, and then that is broken down into a couple of other sections as well. During last year's Parade of Homes outside Delaware there was a home that a prefabricated home. It was one of the nicest homes in the show -- and it was cheaper and took less time to erect than any of the others.

So the modular market has become diverse as the traditional housing market.

That said, we've also seen financing restrict on single and double wides. But as has been posted before if a modular has the FHA tag - then it is fine.

Most lenders are shying away from anything within these categories.  You might get a lot of land, but your financing of it will kill you if you don't go FHA!

Mobile Homes / manufactured homes are different from modular homes.   Not only are they constructed differently they are dealt with differently by lenders.

 

Hi Lauren - They really aren't constructed that differently.  The major difference is the Chassis.  A modular home is built without axles and a manufactured home might have them.  The other differences boil down to local codes.

And as far as "dealt with differently by lenders", the difference with a good lender is this....75 points.  A modular is priced the same as a stick-built, a manufactured is priced .75 points higher.  (NOTE: this is with conventional financing.  In other words, at least 5% down and decent credit.)

Hi Sheri, I know I'm a little late to this party but I've been surfing the AR blog for folks that are involved with the Factory Built Housing Industry. I'd like you to join our Active Rain Group: http://activerain.com/groups/manufacturedhomes.

I'll be happy to repost any contributions and/or listings you post.   We're a Nationwide company specializing in engineered certifications, affidavits of affixture, 433a documentation (Califorinia only), and foundation retrofitting, repair and installation.