Florida Mobile and Manufactured Home FinancingWe finance manufactured homes which are often still called mobile homes.
Florida mobile home financing or manufactured home financing.
First thing is first, technically a mobile home is a factory built home that was constructed prior to June 15, 1976. Even so people still today call newer manufactured homes mobile homes. The terms people use can change depending where you live but in Florida people often use the term mobile home for manufactured homes constructed after 1976.
We do not finance in mobile home parks where the land is leased.
We finance double wide homes as a primary residence and a second home, we finance single wide homes as a primary residence only.
A manufactured home is a factory built home constructed to the HUD Title 6 construction standards that took effect after June 15 of 1976. If it is a manufactured home built to HUD code there will be two forms of verification, a certification label and a data plate. The data plate will be located somewhere inside the home, often near an electrical box, the main thing is it has to be easily visible. You can find the certification label on the tail end of each transportable section of the manufactured home.
Whether you want to purchase or refinance a manufactured home there are some nuances to financing a manufactured home that you need to understand but we are here to guide you through the process.
How important is the certification label or HUD Plate?
Its actually against the law to remove them, the appraiser will need to find them when purchasing a manufactured home. HUD states that if the certification label or HUD tag is missing from the manufactured home, they do not reissue labels. They can however issue a Letter of Label Verification for homes for which it can locate the label numbers on a data plate. This can be found inside the home in one of three spots: in a kitchen cabinet, in a bedroom closet, on or near the main electrical panel. The data plate will have a map of the U.S. to let the consumer know the wind zone, snow load, and roof load for which their manufactured home was constructed for. When an appraisal is done for the purchase of your home or the selling thereof, they will look for all the necessary information, so don’t feel overwhelmed. If there is an issue the lender will the take necessary action to resolve any issue.
Its possible to request a Letter of Label Verification from the Institute for Building Technology and Safety (IBTS). You can call them via phone at (703) 481-2010 or fax them at: (703) 437-6894.
Tie Downs and Other HUD Guidelines
Tie downs being up to current code is the biggest issue we run into when borrowers choose to buy a manufactured home. On July 13, 1994, HUD increased the size of the requirement for the knuckle on the tie downs that attaches to the manufactured home or what a lot of people still call mobile homes. In addition they changed the requirement for the amount of longitudinal and lateral tie downs needed to meet code. This means that if the manufactured home was anchored before July of 1994 there is a good chance that the tie downs will not be up to current code. When you purchase a manufactured home an engineer is required to come out and inspect the home and make sure that it is up to code. The only way around this is via conventional financing on a home with no additions or changes to the roofline or added decking.
If the property has changed hands since 1994 and the purchaser used a government backed loan then it should have been retrofitted to current standards. Additionally the engineer will inspect the siding around the bottom of the home making sure that there are no holes larger than an inch. Preparing for this inspection beforehand is always smart because a hole in the siding is easily remedied with spray foam. Its always best when the listing agent for a manufactured home preps the seller for the possibility that they may need to pay for their manufactured home to be retrofitted if it was anchored before July 13, of 1994.
As a lender I always try to set up the possibility to everyone involved in the transaction of this needing to be done in order to sell or buy a manufactured home. If a borrower is using FHA financing it will always be needed. The Veterans Administration however does not require an engineer report to inspect tie downs. The cost of retrofitting can range anywhere from $1,200 to $3,000, I’ve seen a pretty wide range of quotes depending on the size of the manufactured home. Its important to remember that an escrow hold back is not allowed for the cost of retrofitting the property.
A Few Important in house Manufactured Home Guidelines:
- We can finance manufactured homes as second homes with 10% down.
- We do not finance on leased land, you must own the land. It can not be in a co-op or condo association. HOA’s are allowed.
- In some cases we can finance single wide manufactured homes. You must have good credit and the loan amount can’t be too small (approximately $150,000 or more). We do them on an exception basis. It must also be a primary residence.
- We finance manufactured homes from the Florida Keys to the panhandle. Coastal properties are allowed.
- We do not require an engineer report for conventional financing unless the appraiser calls for one. They typically only do this if there has been an addition to the property.
- We can not finance a manufactured home as an investment property.
You can use conventional financing to purchase a manufactured home with as little as 5% down with p.m.i. (private mortgage insurance). You can also use conventional financing to purchase a second home with as little as 10% down. The HUD guidelines of October 20th of 2008 apply to conventional financing along with FHA and VA financing. A cash out refinance is possible up to 65% of the value of the manufactured home and a max term of 20 years for a cash our refinance. For conventional financing we no longer require an engineer to inspect the tie downs or skirting if there are no additions to the home like decking or awnings.
We offer FHA financing for a manufactured home. The minimum down payment is 3.5% and you must occupy the home as your primary residence. Just like conventional or VA financing the property must be up to current manufactured home HUD guidelines. Its important to note there are rules for the distance of the septic, well, and drain field from the property line. The well must be 10 feet from the property line, 50 feet from the septic tank, 100 feet from the septic tank drain field. However this can be reduced to 75 feet if allowed by local authority. If the subject property line is adjacent to residential property then local well distance requirements prevail over the guidelines. If the property is adjacent to a non residential property the minimum is 10 feet still. Cash out is allowed up to 80% of the value of the home, and a 30 year term is allowed.
Veterans can use their VA entitlement to purchase a manufactured home with no money down! Keep in mind that when purchasing any home that has a well the VA requires both a bacteria water test and a lead water test. The veteran is now allowed to pay for these items when they couldn’t in the past. We do not require an engineer to inspect the property like FHA or conventional financing to make sure that the manufactured home meets the current HUD guidelines. Additionally the veterans administration will allow a veteran to purchase a manufactured home if it has been moved, but only moved one time. This make VA financing the most flexible when it comes to financing manufactured homes. Its a great benefit for veterans.
Our Manufactured Home Guidelines
- Both MFH and land must be titled together and classified as real property.
- Primary and second homes only (no investment)
- Double Wides and Single wides, Single wides must be a primary residence
- MFH homes that have ‘moved’ once built are ineligible unless the borrower is utilizing VA financing.
- Towing hitch, wheels and axles must be removed.
- Minimum of 600 square foot living area required
- Must be affixed to a permanent foundation, (tied downs are ok).
- MFH’s built prior to June 15th, 1976 are not eligible.
- Appraisal form 1004C must be used and must clearly reflect a photo of the HUD Certification Tag.
- Land must be owned as Fee Simple. Leaseholds and MFH Condo lots are ineligible. No co-ops.
- Automated underwriting approval required for conventional financing. DU must clearly indicated the structure as a Manufactured Home. FHA and VA manual underwrites are allowed.
- Min 620 FICO for conventional, 600 minimum score for FHA and VA
- Maximum LTV—Follow agency guides.
- Maximum 90% LTV allowed Second Home.
- Structural foundation certification not required unless the appraiser notes issues or requires such a certification.
- Structural engineer certification only required if changes to the original structure were made (such as added porch or roof line) or if the appraiser notes issues.
Please note that due to lending restrictions and secondary market appetite its very difficult to finance a manufactured home under $80,000.