VA and FHA Loans For Mobile and Manufactured Housing

For government-backed home loans and refinance loans such as FHA or VA new purchase mortgages or refinancing, qualified applicants often wonder if these programs will allow the purchase of a mobile home,  a modular home or a manufactured home.

 

The answer to these questions may be yes depending on a variety of factors including the age of the home, whether or not it’s affixed to a permanent foundation (or will be at loan closing time) and whether or not the foundation meets local, state, and federal guidelines.

 

VA loans do permit the purchase of mobile homes.  The VA loan can include the home and the land the new home will be situated upon should the owner choose to purchase land instead of renting space to put the home down upon. What the VA loan program does not allow is for the use of VA guaranteed loan funds for anything that cannot be classified as real estate or taxed as such. That means if the home has no permanent foundation, it is not eligible for a VA mortgage.

 

The same is true of FHA mortgages and refinance loans. FHA loans can be used to purchase the same types of mobile, modular, or manufactured homes.

 

FHA loan rules permit the refinance of mobile homes under certain conditions in its Title I loan program. According to the FHA,  “Under the Title I program, FHA approved lenders make loans from their own funds to eligible borrowers to finance the purchase or refinance of a manufactured home and/or lot. FHA insures the lender against loss if the borrower defaults. Credit is granted based upon the applicant's credit history and ability to repay the loan in regular monthly installments.”

 

FHA loan rules have specific guidelines for refinance of mobile homes under Title I. Unlike home loans and refinance loans for traditional suburban properties, the maximum loan amount and term of refinancing is listed as follows on the FHA official site:

  • Manufactured home only - $69,678
  • Manufactured home lot - $23,226
  • Manufactured home & lot - $92,904

 

The maximum dollar limits for lot loans and combination loans may be increased up to 85 percent in designated high-cost areas, according to FHA.gov. The maximum loan term is as follows:

 

  • 20 years for a loan on a manufactured home or on a single-section manufactured home and lot
  • 15 years for a manufactured home lot loan
  • 25 years for a loan on a multi-section manufactured home and lot

 

 

Rate this item
(0 votes)