3 Reasons to go with a Manufactured Home Finance Professional

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Using a manufactured home finance specialist will save you money and grief.

Using a manufactured home finance specialist will save you money and grief.

It seems like common sense that if you need financing for a manufactured home, then working with a lender or broker that specialize in your needs is the way to go. However, many mobile home buyers are lied to or deceived by desperate agents or companies that specialize in traditional lending, trying to break into mobile home loans. Only after dragging their customers through the entire (process and racking up quite a bill), do they realize that they could not secure financing for a manufactured home to begin with. Many of our customers don’t find us until another lender or broker has cost them up to $1,000. If this isn’t convincing enough, here are 3 reasons to seek out a mobile home loan professional to learn your financing options.

1. The banking and real estate market changes every day, and this includes the mobile home market.

Only a specialist in mobile home finance will know the lenders that do and don’t lend for manufactured home loans. Many lenders that used to lend for mobile homes, stopped their programs within the past 6 months, and if they didn’t cancel their program they have changed it quite a bit. Only a firm that specializes in mobile home finance will know the ebb and flow of this highly specific niche market.

2. Manufactured home finance has it’s own laws and regulations.

An agent or broker that only works with traditional loans does not know the intricacies of the mobile home market. This leaves the buyer, seller and any third party very exposed to legal action if the agent or broker’s ignorance causes any legal or regulatory snags in the deal. Manufactured homes are treated very differently in federal and state laws, and unless the agent or mortgage broker is in the know, there is a huge potential for a catastrophic mistake.

3. Using a mobile home loan specialist will save you money, short term and long term.

Real estate agents and mortgage brokers without mobile home experience try to apply their traditional housing experience to mobile homes, and this does not work. They will charge you to get an appraisal on a home that may not even have any comparable sales in the area, which makes it nearly impossible to finance. This will waste $400 of your hard earned money, and you’ll get nothing for it. A manufactured home specialist knows the process, and you will enjoy the wealth of experience they currently have, instead of being drug through the learning curve of a stick-built agent. Use a manufactured home finance expert from the beginning, and you are much better off.

Renting vs. Buying a Manufactured Home

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Renting vs. Buying a manufactured Home

Renting vs. Buying a manufactured Home

How do you know what makes more sense, renting an apartment or buying a mobile home? There are many factors that come into play, and the process of analyzing can be overbearing. So, here is a short and sweet post about where to start.

Not everyone is a CPA, and knows how to calculate the feasibility of buying a mobile home over renting an apartment. So, it is important to keep things simple. It comes down to two questions you must ask yourself if you want to own a manufactured home. If so, you must qualify for a manufactured home loan? Click to apply now.

If you decide that you don’t want to own and live in a manufactured home, stop reading now. If you are interested in becoming a homeowner and investing in your future, then read on.

Does it make Financial Sense?

First, take your current rent and multiply it by 12 (months) and then multiply it by 20 (years), then multiply it by 1.25 (to loosely account for rent increases). Now you know how much you will spend on rent over the next 20 years, and have nothing to show for it. If your rent is currently $500 per month, then you will spend about $150,000 over the next 20 years.

Do you trust the Real Estate Market?

In this market, it may be difficult to see real estate as a sound investment. But if you look at the big picture, it has traditionally been very strong. However, even with the recent housing market slump there has been about a 100% increase in housing prices. This means that if your $500 rent payment was made towards a mortgage, you could have a home worth $300,000 after 20 years, rather than nothing.

Can you get Approved for a Manufactured Home Loan?

The financial market meltdown has certainly made it more difficult to get financing for a manufactured or mobile home. However, there are still lenders and brokerage firms that know how to get you approved. You do have to be a very low risk to the bank, though. You must have good credit, no bankruptcy in the past 4-5 years, a down payment of atleast 10%, and a verifiable income. Taking all of this into account a mobile home mortgage broker can configure your ratios, and you are on your way to owning your very own manufactured home.

HUD allows the First Home Tax Credit to be used for down payment

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HUD states, “The American Recovery and Reinvestment Act of 2009 (Recovery Act) provides for as much as an $8000 tax credit to qualified first-time homebuyers. FHA supports this important initiative to promote homeownership… Consistent with existing FHA policy, FHA will permit entities covered by Section 528 of the National Housing Act to use the current authority to offer tax credit advances with second liens in a manner consistent with the requirements in 12 U.S.C. 1709(b)(9). Eligible government agencies and instrumentalities of government are described in handbook HUD-4155.1 5.C3 and 5.C4.”

The First Time Home Buyer Tax Credit is available to Manufactured Home buyers.

Are Mobile Home Loans more Difficult than Real Property Loans?

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Mobile Home Loans

Many people are curious, or stumped, when it comes to the differences between loans for mobile homes and loans real property site built homes. A lot of lenders that finance condominiums and single family real property homes do not lend on mobile homes, and a lot of people do not understand why. Well, there are some big differences in the properties themselves, and these differences affect the types of loans that can be done on the homes.

Basically, when you are looking at getting a loan, you need to put down collateral for that loan. The collateral for your loan is going to be the main factor where there are differences between a Mobile Home and Manufactured Home Loan and traditional “stick built” home mortgages. Just like how getting a loan for your vehicle and getting a loan for your business are two different types of loans, so are loans for mobile homes and real property site built homes.

In the United States, a mobile home loan is also referred to as a “chattel mortgage”. Chattel mortgages are securitized transactions, governed by Article 9 of the Uniform Commercial Code. The lender on a chattel loan secures the loan with a mortgage over the chattel, or the Mobile Home. Because chattel is defined as personal property, movable or immovable, for example, a book, a coat, a pencil, growing corn, a lease, a mobile home is considered a piece of personal property that could, for all intents and purposes, be moved; often times mobile homes are considered as riskier collateral than a real property, site built home.

Traditional homes that are built on site and include real property are a bit different from chattel, or mobile home loans. A mortgage loan for this type of home is a loan secured by real property through the use of a Note, which is a document that evidences the existence of the loan. Real property mortgages can and should be additionally evidenced by a Deed of Trust document, which is recorded with the County Recorder. The Recorder is a county official that insures that instruments are recorded, giving public notice of such transactions. The Deed of Trust will be recorded with the County Recorder of the County where the real property is located. Because there is no real property ownership involved with a mobile home loan, a lender cannot record any documents against the title to a mobile home, to further secure the loan.

Mobile Home Mortgages are not recorded or secured in the same fashion as real estate, or real property loans. The title information for mobile and manufactured homes is maintained by agencies directed by The United States Department of Housing and Urban Development. In the State of California, The Department of Housing has “Registration and Titling” offices that are specifically assigned to maintaining the title information on Mobile and Manufactured Homes. The homeowner, or purchaser, of a mobile home shall be shown on the title as the registered owner, and the lender shall be shown as the Legal Owner to the mobile or manufactured Home. When a mobile or manufactured home is encumbered by a Legal Owner, the actual Certificate of Title to the mobile home is issued to the lender, or legal owner. The homeowner, or borrower, is issued a Registration Card, which evidences the homeowner´s Registered Ownership interest to the mobile home. With site-built, real property homes, the homeowner retains a Grant Deed to evidence their ownership in the home, and the lender maintains the Note and Deed of Trust to evidence their ownership interest in the real property home.

It´s helpful to understand these title and security differences, as they play a major role in determining the actual loan type, qualifying agents and the loan process itself. Manufactured Homes  and real property site built homes are not only built differently, but titled differently and mortgaged uniquely as well.

Manufactured Home Financing Has Changed

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We are still the go to company for manufactured home finance

We are still the "go to" company for manufactured home finance

The old days of stated income, stated asset, no down, and B Paper lending to mobile home buyers are over. As underwriters have tightened their belts, you now must have decent/good credit, with no lates or missed payments and a down payment on the home you are looking to buy. A new obstacle in manufactured home financing and refinancing is that home values are declining, and comparrisons are dragging the appraisal prices down. In times like these, it helps to know a great lender or broker, and we are both. We can still get a good amount of our customers loans, but its not as easy as it used to be. I hate to think about how hard other companies have to try to get funding, without the experience we have. It must feel like banging your head against the wall. The only people we feel worse for is their customers who pay hundreds of dollars, out of pocket, just to get declined on their loan. Since we know the programs that are still available for manufactured home financing, and we can even fund our own loans, we can offer the best rates and a far greater chance of completing your financing. Call us today, or fill out our secure online application if you are interested in mobile home financing.

The True Origin of The Mobile Home

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Mobile Home Origins

So you think you know how Mobile homes came to be called such? Easy, Right? Because they can be moved from place to place, hence a home that is Mobile. Mobile Homes.

Well, this is actually a common misconception.

According to snopes dot com, “The origins of the mobile home are tied to the end of World War II. The rapid downsizing of the U.S. armed forces after the surrenders of Germany and Japan in 1945 brought back millions of servicemen (and servicewomen) to the United States from overseas in the mid-1940s, many of whom were coming of age and anxious to establish their independence, attend college, get married, and raise children. This demographic bulge, coupled with America’s burgeoning post-war recovery from the Great Depression and a wartime economy, created an unprecedented demand for housing — both for standard residential units and for quarters to accommodate the many servicepeople who were taking advantage of G.I. Bill benefits to complete their educations at colleges, universities, and other types of schools.

The widespread use of military-style prefabricated housing eased the severe housing shortgage temporarily, and the eventual creation of suburbs such as Levittown took care of much of the long term need, but neither of these solutions addressed a potentially lucrative marketing niche — people who were dissatisfied with living in barracks-like housing but didn’t want to (or couldn’t) wait years for the construction of affordable suburban housing. It was James and Laura Sweet, a couple from Prichard, Alabama, (a town just outside of Mobile) who came up with the concept that fulfilled that market niche.

James Sweet, a machine shop supervisor by trade, was reportedly finishing off his workday lunch one afternoon in January 1946 when a newspaper article about the post-war housing shortage caught his eye. What if, he thought, someone could manufacture a type of housing that could be put together cheaply and quickly at a central location, but was small and light enough to be transported to wherever the purchaser wished to locate it? Something like the prefabricated structures of the era, but much nicer and more home-like — a prefab housing unit divided into discrete rooms (rather than one large open space) with all the electrical and plumbing fixtures already in place. They could be built as one- or two-piece units, then loaded onto flatbed trucks and delivered wherever the purchaser desired.

Sweet’s wife, Laura, was a commercial artist who did illustrations for magazines, and she drew up a few simple floor plans according to her husband’s directions. James Sweet built a couple of prototype units in his off-work hours to prove his concept viable, and then, satisfied with the results, used the couple’s savings, mortgaged their home, and borrowed against his life insurance to establish Sweet Homes, a company dedicated to the manufacture and sale of prefabricated  homes.

National advertising was still something of a rarity in the 1950s, but as the new national highway system enabled the sale of prefabricated homes to spread outwards (mostly to the north and west) from the Alabama/Mississippi area, more and more consumers were exposed to the houses, liked them, and began clamoring for their own “Mobile homes.” Business boomed, more manufacturers entered the fray, and factories were established all over the U.S. to better serve local customers. Eventually whole communities of these types of homes were created all across the country, populated by homeowners who preferred them to more expensive and more closely-quartered suburbs full of site-built housing.

Over the years, however, as the generation who fought World War II aged and prefabricated homes became commonplace throughout the U.S., newer consumers were unaware that the appellation “Mobile home” was a geographic reference, a term coined in acknowledgement of the area in which the industry got its start. The name was more and more frequently rendered as a common compound noun (“mobile home”), leading many to mistakenly conclude that it referred to houses that were “mobile” — that is, movable from place to place. While “mobile homes” can indeed be transported, they are of course far from mobile — in the vast majority of cases they are never moved off the sites to which they are originally trucked. (Most “mobile homes,” once situated, are moved again only if their owners replace them with newer models, or if they have to be removed because the land on which they sit has been converted to other uses.)”

And now you know the true origin of the Mobile Home.

go to snopes dot com for further information and literary citations.

Mobile Home Loans in the Economic Recovery

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Mobile Home Loans in the Economic Recovery

In the current economic recession, it seems like the average American is able to afford less and less.

These unfortunate circumstances have placed affordable housing in quite high demand. It’s no surprise now that manufactured homes and mobile homes are paving the way when it comes to reasonably priced housing. With this increased demand, there will be more and more Americans living in factory built homes. As ownership of manufactured and mobile homes has increased, so has the demand for Mobile Home Loans.

At the introduction of manufactured and mobiles to the housing market, most of the average mortgage banks were uninteresed in offering Mobile Home Mortgages. Most mortgage banks lumped Mobile home loans in the same category with car or vehicle loans. Much like vehicles, manufactured and mobile homes were thought to quickly depreciate in value, unlike a traditional stick-built home or condo that typically sees equity gaining over time.

Due to the lack of equity appreciation, for many years it was improbable that a manufactured or mobile home refinance or equity loan would be made available to owners of factory built homes at all.
As time went on, home values skyrocketed faster than general income could keep up with. The depreciation of manufactured and mobile home owner’s equity started to slow down.  Eventually the equity losses  stopped altogether. Manufactured and mobile homes soon were actually increasing in equity, in part due to the increasingly superior quality and safety of manufactured and mobile housing, coupled with federal and state laws governing the factory-built process.  While mobile home owners invested in their homes and continued to maintain and improve them, they gained precious equity.

Today, rate-and-term mobile home refinance loans and cash-out equity loans have become readily available to eligible owners of manufactured or mobile homes. It has become reasonably easy to locate what was considered “non-traditional” and even undesirable financing for manufactured or mobile homes.

As the current real estate market begins to recover, the manufactured and mobile home market endures the same loss of value as the “stick-built” and condominium homes. In the midst of the recovery, manufactured and mobile homes still remain viable for financing at terrifically competitive interest rates. These loans should be eligible for rate-and-term refinancing in the not-too-distant future and perhaps even “cash-out” equity loans in the somewhat-near-future.
There was a time when a manufactured or mobile home loan was frowned upon as a mere “car loan”.
Those days have long passed as manufactured and Mobile Homes have emerged as the last affordable housing in America with competitive financing available to qualified buyers.

California Manufactured Housing Development on the Rise

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So, is now a good time to buy a manufactured home in California?
The latest statistics say yes. In a recent comparison of home prices to rental agreements, the gap has closed to under $120 (msnbc). Therefore for just over a hundred dollars a month, you could own the house, condo, or mobile home you are renting. In the past, California´s past comparisons between renting and buying have normally been well over $1,000 per month difference.

California Manufactured Housing Development on the Rise

Recent American Chronicle Article about Mobile Home Finance

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Mobile Home Loans : American Chronicle Article

Mobile home loans or manufactured home loans can be financed as a chattel mortgage or a personal property loan. In this article you will learn the differences, and how they relate to tax write-offs, payment structures, credit scores, bankruptcy, and much more.

When searching for a mobile home loan, it is very important to find an expert that specializes in manufactured home finance. Otherwise you may end up losing your approval in the eleventh hour because the underwriter realizes that they just can´t approve a loan for a manufactured home.

Mobile Home Loans – Quick Tips

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Are you thinking about refinancing your mobile home or getting a loan to purchase a mobile home or a manufactured home?
Make sure the lender you are working with is Qualified to lend in your state and that they have a good standing reputation.
Here are some Important questions to ask your lender:

What licenses do you have to lend in this state?
Are you a member of any Manufactured Housing Associations in the state?
How long have you been in business?
What state are you located in?
What state will my loan be processed in?
Are You Able to Lend your own Funds?
Are You Equipped to Service Loans In-House?