Who finances mobile homes?
There are many institutions who finances mobile homes. The banks and other lenders or home builders can help in financing of the mobile homes and there are some sellers that would owner finance or seller finance the mobile homes. Mobile homes are very affordable and easier to own to make you a home owner.
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There are many models that are very spacious and beautiful at a fraction price. Although the beautiful ones can be slightly expensive. An average mobile housing is usually around forty-five thousand, six hundred dollars for the single wide and the double wide for eighty-seven thousand, seven hundred dollars according the CFED.
This amount is not usually what people budgeted for and this brings us to the question, who finances a mobile home?
You can get loan from the bank and this is sometimes not exactly simple because of the bank charges and interest. But to get loan from the bank, you must have a very good credit score usually around 700. This credit score is got from the credit reports from that bank. The purpose of this credit score is for the bank to be rest assured and be convinced that you would be able to pay back both the principal loan and interest rate on the principal money.
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They also want to know if you have the ability to pay the mortgage price including other charges like the tax. The banks can also help you in financing the mobile home if you have a good customer record with the bank but you must be able to give the assurance you would pay back the money unless you want to have the home to the bank at the end of the loan agreement.
Financial companies helps in financing of anything. Personal financing, corporate financing and other types of financing are mostly helped by the financial companies. In financial companies, you are provided with promissory notes which include the terms and conditions of the agreement.
In the promissory note, the mortgage payment to be made, the end of the agreement, defaults are all stated in it. They provide you with loan and with the assurance of paying back the money and other charges on it including the financial charges and interest rate on it. To give them the assurance of paying, some financial companies can ask you or order you to bring a guarantor who will sign a document showing that he or she would pay if you could not pay at the end agreement period.
In seller financing, the manufacturer of the mobile home would help in getting a lender to finance the mobile home. The mobile home is built with the money from the third party which is paid to the manufacturer, so the mortgage payment would be made to the account of the lender instead of the manufacturer. In this too, a promissory note would be issued and must be signed by you and the manufacturer including the lender.
The manufacturer builds the mobile home himself with his own money. In owner financing, the manufacturer would pay for the financing himself so that you can get the mobile home from him. You can also get an owner that wants to finance the mobile home which is already made but probably not with the land.
Most manufactured homes are insured by the federal housing administration and many lenders wants to finance the home if it is insured by the federal housing administration. The federal housing administration do not give out loan exactly, it only give insurance to the lenders that you will have to pay to. The only thing to be done by you is to find a lender that has been approved by the federal housing insurance and have negotiations with him. In this, you would be required to make two types of mortgage insurance in which one goes to the lender and the other goes to the federal housing administration.
The good thing in FHA loan is that they provide three types of loan in which are:
- Both the home and land
- The land alone excluding the home
- The home and not the land.