How to Purchase or Refinance a Class C Doublewide in Delaware
There are several loan programs to cover the purchase of a Class C Doublewide manufactured home. In this article I am detailing the FHA loan. With this program you can purchase with a 3 ½% down payment. A rate/term refinance can be done at 97.75% loan to value and a cash out refinance is 85% loan to value. (Loan to value = loan amount divided by the appraised value.)
The FHA loan can be done for borrowers with a 660 or above credit score. The loan term can be 15, 20, 25 or 30 years and the interest rate is fixed throughout the term of the loan.
A Class C manufactured home is defined as a double wide or multi wide manufactured home where the title has been retired and the home has been converted into real property. The home will need to be anchored to the concrete blocks piers underneath the home. Plus, it is required to have a cement block foundation under the perimeter of the home. (No skirting.)
For the FHA loan the home must have been built on or before June 15, 1976. You can check by looking at the HUD plates attached to the sections of the home on the interior and exterior. If the tags are missing a request can be made to the Institute for Building Technologies (IBTS). The fee is estimated to be $125 for a copy of the tags to be emailed to you.
The FHA loan covers both the home and the land. It can be used to purchase or refinance. The refinance can be a cash out, rate/term or a Streamline.
For a brand new home, an invoice will need to be provided by the manufacturer, retailer or dealer. Also, on brand new homes there is a 10% down payment unless: the initial foundation inspection is completed before the conditional commitment or a 10 year protection plan is provided by the builder.
A structural engineer’s report will need to be provided to the appraiser and the appraiser must indicate in their report that it was provided. The cost of an engineer’s foundation report is normally $400. The engineer’s report needs to show the home has not been moved to this location from another site. Plus, they will need to report that there is no indication that alterations have been made to the home since it was first placed on the lot.
Example of the numbers involved:
$160,000 purchase price would require a 3 ½% down payment ($5600). Base loan amount $154,400 plus $2702 for the upfront mortgage insurance premium = $157,102 total loan amount. Principal and interest payment would be $820.82 based on a 4.75% rate. Add to that, $111.28 for monthly mortgage insurance. And add in estimated property taxes of $70 per month and $60 per month for homeowners insurance. This equals $1062.10 for a total monthly housing payment.
That pretty much covers this topic. If you have any questions or would like to find out if you qualify for this type of loan, give me a call at 302.855.1306 or email MMODJoAnn@aol.com. I am a licensed mortgage loan originator, NMLS #165477 and have been helping people become home owners for 20 years.