How To Afford Living Alone In A Mobile Home Whether Buying Or Renting

by Jan 19, 2018Blog, Buying a mobile home, Finance, Renting a mobile home




Moving out of the family home or becoming independent of your parents in one of the biggest steps to becoming an adult. It’s during these first few years that you can find yourself and come to terms with what you are capable of. One of the major obstacles to overcome is how to afford living alone.

How To Afford Living Alone In A Mobile Home Whether Buying Or Renting - Featured Image

You might not be expecting mobile homes to make a good type of housing for someone looking to live alone on a single income. However, the truth is that there are a number of characteristics that make them budget-friendly.




Why a mobile home is budget-friendly

Mobile homes are still affordable housing

One characteristic above all sets first-time home buyers apart. Chances are, you haven’t built up much in the way of money or don’t earn a significant income just yet. Don’t worry! We are sure you will get there soon.

Without mobile homes, most people looking for their first place would only be able to choose from dingy flats, room-shares, or small apartments in questionable neighborhoods.

Even university graduates, that earn the most straight out of school than any other demographic, only earn around $50,000 a year before tax. That equals around $38,000 after tax which comes down to a little over $3,000 per month.

The government recommends that no one spends more than 30% of their income on housing. That leaves you with around $1,000 budget per month on accommodation. If you take into account that the average apartment rent in the U.S. is $1,200, you can already see that we have a problem.

Mobile homes are a great low-cost alternative. They cost around ¼ of the price of a stick-built home and with the average lot rent at around $300 and the average home rental at around $400, they cost half as much to rent as the average apartment.

At this price, you get a lot more space, a community feel, and the pride of being on your own standalone piece of property.

Inexpensive maintenance

workbench

We already laid out how tight the budget of most fresh graduates are. That means you don’t want to be on the receiving end of a bunch of high maintenance bills at regular intervals. Another big benefit when it comes to mobile home living is that they are relatively inexpensive to maintain and repair compared to stick built homes.

Because they are made with less expensive materials that are also easier to cut, add to or replace, it dramatically cuts down on maintenance times and cost. In some areas, such as plumbing, mobile homes manufacturers user newer and better materials that are inexpensive to replace and last longer than the typical copper pipes found in stick-built homes.

You will probably need to do maintenance more regularly on a mobile home than on a stick-built home but you are almost guaranteed that any problems that do occur will be easier and quicker to fix.

If you rent the mobile home in the park, depending on your lease agreement, the management will often take care of these problems for you too.

How to afford living alone in a mobile home

Many can’t wait to tackle the challenge of being on their own, while for others it can be one of the most anxious moments of their entire life thus far. Whichever category you fall in, we bet you can do with some more advice on what constitutes a smart move as someone who is about to live on their own for the very first time.

While a mobile home is budget-friendly, it’s still important to know how to afford living alone. Here are some tips whether you’re buying or renting your first mobile home.

Tips before you buy your first (mobile) home

Have a look at your assets and liabilities

As a burgeoning adult, you might not have much (if any) experience regarding your financial matters and getting them in order.  Doing your books, so to speak, might induce some feelings of panic and anxiety.

Don’t worry! All adults were there at some point. It’s not that hard. You just need to get started and soon enough it will become natural.

You might be wondering what assets and liabilities you could possibly have. Technically, everything you own counts as an asset, but for these purposes, only things of significant value should be taken into account. For example, if you have a car in your name as well as the actual money you have in your savings account.

A common liability for a first-time home buyer is a student loan. This will form part of your debt-to-income ratio and could affect your financing. You also need to factor this into any monthly payments you need to make.




Learn more about your financing options

How much time and effort you should put into this tip, depends on how you decide to live in the mobile home. Do you plan to buy a mobile home in a mobile home park? Or do you plan to live in a home that’s placed on private property?

In either of these two instances, you might need to apply for financing in order to afford the home. A mortgage or loan allows you to pay off the value of the home over time to a financial institution or bank with interest. Usually, you make a lump sum down payment at the start of the loan that acts as collateral and reduces your monthly payments by taking a chunk out of the equation.

You will need to do a little reading up on amortization periods, principal amounts, terms, interest-only periods, open vs. closed mortgages, fixed vs, variable rates, and etc. to really know what you’re doing. Don’t be ashamed to ask someone, like one of your parents, that have experience in these matters for some help. It can often be confusing for first-timers.

It will be much more expensive, yet easier, to qualify for a loan if you purchase the land with it. On top of that, you should look at the mortgage support options available, such as an FHA-backed loan.

Accounting

Build a support base

Just because you are moving out on your own, doesn’t mean you will be left with no one to turn to. Make sure that you find the people closest to you and establish how much you can rely on them in case of an emergency.

For example, who can you turn to if you have to vacate or lose your home? Can your parents or someone else help you with a down payment or securing a loan?

Some of you might be tempted to go it alone out of hard-headedness or a sense of pride. However, this is bound to be a tumultuous time in your life that is equal parts exciting and terrifying. Having someone you can rely on from time to time might just save you should things go south.

Start saving up!

Hopefully, you are reading this article a while before venturing off to find a cozy nest of your own. One of the biggest tips you could ever give someone planning to stay on their own is to start saving up and to be very disciplined. Not only will this greatly improve your odds in the single homeowner game, but it’s also a crucial skill for the future.

For one, having some money saved up to make a big down payment will dramatically up the value of the type of home you can afford. A sizeable down payment lowers the amount to be paid off and gets you a better interest rate.

Getting a loan on a mobile home is not as easy as with a stick-built home and something like this can do a world of good for your chances, particularly as a first-time buyer.

On top of that, there will inevitably be a bunch of expenses you missed when budgeting or that come out of the blue. This could be much-needed maintenance or repairs to the mobile home so it pays to have some spare cash lying around.

Not all mobile homes are created equal

When it comes to aging, mobile homes are very different to their stick-built counterparts. Mobile homes tend to depreciate in value over time whereas stick-built homes tend to appreciate. This is only of real significance if you intend to buy the home as you will need to be aware of the fact that you will almost definitely only be able to sell it later at a lower price.

Older mobile homes are also often prohibited from getting any type of financing and if they are built before 1976 they also will not adhere to current housing standards. Mobile homes require some upkeep over time so you should try and establish in what shape it is before moving in.

Tips for renting your first (mobile) home

Let’s say you’re not looking to buy just yet. A mobile home is a great rental option as well. And if you move into a mobile home community, you’ll find you have lots of built-in support right away. Let’s take a look at how to afford living in a mobile home that is rented.

Budget, budget, budget

Now that you’re living on your own, you’ll definitely need to manage your money wisely. Any housing you move into will come with its own set of fixed expenses. These expenses, such as rent and utilities, you have to pay every month no matter what.

After you pay your fixed expenses, you need to know how much you have left over. Figure this out by taking your monthly income (after taxes) and subtracting what you estimate your fixed expenses will be. Now, you’ll divide that amount out among your savings, investments, other expenditures. In other words, decide how much of your money will go to different categories.

Most people create a budget that includes:

  • Rent
  • Utilities (electricity, water/sewer, gas, cable, internet, phone, etc.)
  • Loan payments
  • Groceries
  • Restaurants
  • Car maintenance and fuel
  • Shopping
  • Personal care
  • Savings/investments

If you want to make sure you’re not overspending, try using a budgeting app like Mint.com. Once you connect it all your financial accounts, it will track the numbers for you! It’ll even send you notifications if you’ve overspent a budget category.




Ask lots of questions

Once you sign a rental agreement, you’re usually locked in. The only way to break your contract after the initial period (e.g. 30 days) usually comes with a penalty. Make sure you know what you’re getting yourself into before you sign anything! Ask lots of questions. Here’s a list we came up with to help you in your research.

In addition, it doesn’t hurt to ask current residents how they like the place. They may be able to share some insights you hadn’t thought of before. At the very least, read reviews about the mobile home park or rental agency.

Have startup funds and a safety net

jar of coins

Inevitably there will be things you want to buy or change when you move into your own place. Have money set aside so you can shop for the perfect piece of furniture that will really make it your home. You may find that you want to change out blinds with curtains or add a rug. As a side note, make sure you’re not breaking your lease agreement if you make any changes.

Don’t spend all your money upfront. Make sure you keep a safety fund for emergencies. While your landlord will be responsible for most major maintenance issues, there will be things you need to pay for. So read your lease agreement carefully. You’d hate to be hit with any major surprises like servicing your air conditioner or paying for snow removal when you thought it was already covered.

Enjoy living the life of a single in your mobile home!

If nothing else, we hope that this article showed you that it is possible to venture out on your own as a single. You just need to know how to afford living alone in a mobile home. Mobile homes can provide an extremely pleasant living experience and can offer some of the best home comforts at a fraction of the cost. Don’t sell yourself short and leave them out of your search for a new home.

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