That’s why we’ve compiled some of the details you will need to get you started on your journey and well on your way to becoming a manufactured home owner.
Plan on a down payment
While down payments aren’t always necessary, you will find it significantly more difficult to get approved for manufactured home loans for bad credit. Especially if you aren’t able to afford sizeable amounts up-front. This is because mobile homes, unlike regular, conventional homes, depreciate in value over time. A twenty to forty-five percent down payment will make your chances of being approved much higher.
Poor credit and no down payment will make a loan from traditional sources much less likely.
Saving the money for a down payment can be extremely hard if you are on a tight budget. However, no worries. It can frequently be done with patience and commitment. Try finding somebody you know who has done it before. Or have a look online for some good resources on saving when money is tight. There are many budgeting sites and apps that may be helpful, as well.
Determine whether your manufactured home will be on a lease or on owned property
This one is important to think about. In fact, it makes all the difference in the world when it comes to getting a conventional loan.
A manufactured home on leased property is far more difficult to finance than one that is on a property that you already own. If you are attempting to get a mortgage with a package that includes both land and manufactured home, your chances of getting conventional financing are significantly higher. Generally, banks and traditional home mortgage loan providers will not approve a conventional loan if the mobile home will be on a leased property.
However, a chattel mortgage, which is a mortgage on personal property, may still be obtained. This would also apply to a mobile home that is not on a fixed permanent foundation. Since it would be fairly easy to remove it from the property. Also, in most cases, taxes for manufactured homes on leased land are paid to the DMV, rather than the state. This makes manufactured homes considered more like personal property and less like real estate.
Make sure you always shop around. Don’t take the first loan that is offered to you, because there might be a better one available. Also, just because you are told no, that doesn’t mean there isn’t a lender out there who would be willing to approve a loan for you, regardless of your situation. There are loans available specifically for people with a history of bankruptcy, foreclosure, late payments, etc. Additionally, you should be sure to talk to your bank and a real estate agent. They can help you find out what kind of options are available to you.
Consider alternative loans
And lastly, if you’re still struggling to find a lender who meets your needs, perhaps the answer for you is to try thinking outside of the box. With a little extra consideration, you may find something that actually works better for you and your family. More than what a traditional loan can offer.
Many mobile home owners are happy to work out an owner financing arrangement. Almost always, they may be willing to work around your specific situation. You might also consider a personal loan from a family member, or even a friend. Let’s be real. You never know who in your life might be happy to help you get into a home of your own!
It’ll take some hard work, but it’s worth it!
As you can see, with a little bit of patience and perseverance, getting manufactured home loans for bad credit is completely possible. The process may be difficult. But in the end, you will have what you worked so hard for. A home.
Knowing where to start is just the first step. With some research and digging, you can find the financing option that works for you. And you’ll be that much closer to being the owner of the home you’ve been dreaming of.
Before you jump into becoming a new homeowner, make sure you take a look at our overview of the best and worst manufactured homes!