How to Find Mobile Home Lenders

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This seems like a contradiction, but it should make Manufactured Home loans a logical consideration among the possible lenders that are looking to emerge into a lucrative new niche market. Which leaves everyone in the Mobile Home community asking the question: Who will step up to the plate to be the leading Mobile Home Lender? It is possible that Warren Buffet will step up to the plate, but his big investments and movements lately have seemed incongruous. He may move to a low-stakes table, while the Manufactured Home financing market is overtaken by a new investment company willing to emerge into a new market starving for capital.

Lending standards in the Manufactured Home finance market have typically become restricted throughout periods of economic hardship. This is expected, but still unwelcome. The tight standards that lending institutions are now maintaining for Manufactured Home loans can be compared to a agriculturist who drains all the nutrients from his dirt as quickly as possible. The farmer then blames at the grocer for his losses, instead of realizing that he himself is truly responsible for poisoning the well. The banks have been taking advantage of the relaxed laws for nearly half a decade, while profiting from allowing irresponsible lending to occur, then securitizing the loan and selling it off. Now the hens have come home to roost, and the banks are acting irresponsibly in the opposite direction, on the side of over caution. Manufactured Home lending institutions are using any excuse to reject completely sound loans.

Mobile Home finance California agents are now in the position of not knowing who the new primary lender will be in the Manufactured Home finance industry after the dust settles. In recent news the fed has banned Taylor, Bean and Whitaker from providing any future loans backed by by the federal government. HUD believes Taylor failed to submit a necessary financial report, which amounted to fraud concerns. Taylor was also ordered to cease in issuing MBS for Ginnie Mae. This firm was the former premier source of funds for manufactured homes, they lent nearly $1.45 billion of all Manufactured Home investments in 2007, which were insured by the Federal Housing Administration.

Wells Fargo, JP Morgan Chase Bank, and Countrywide are the remaining large mobile housing lenders, but these companies aren’t as active as they used to be in the Mobile Home loan market. This small amount of lenders will likely lead to downsized competition, yieldning a high demand and therefore, higher interest rates passed on to the consumer. In this scenario, the lenders have the upper hand and will probably only issue a limited number of loan programs available to refinance or finance a Mobile Home in America.

Mobile Homes have been the first step towards homeownership for lowincome and retired Americans for quite awhile. Mobile Home loan brokers are discovering it more and more challenging to find new sources of mobile home funding from a group of lenders that has shrunk during the past several years. Manufactured houses, which are factory-built in parts and then put together at a land site, are significantly less expensive than traditional homes. According to the Commerce Department, the average price for a Mobile Home in 2008 was $65K, much lower than the average price of $292K for a site-built home.

Strangely, Warren Buffet’s Berkshire Hathaway revealed recently that in this current housing/banking crisis, their Mobile Home customers are foreclosing less and making their loan payments more. Berkshire subsidiary Clayton Homes’ delinquency rates for mobile home loans have also been stable during these times of turmoil: the delinquency rate was 3.26% in 2004; it was at 3.5% in 2008; and now it’s 3.82% here in 2009. However, the delinquency rate in the traditional housing market is higher, around 6.4%. Annual credit losses are running steady at a reasonable 1.5% of the loan portfolio. It is worth mentioning, however, that Clayton does not securitize their loans. This means the loans remain on their books, so they are much more conservative in their loan approval process.

What is Your Best Mobile Home Loan Option?

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While searching for a California mobile home loan, there is a determining decision to make before even beginning to consider your options. You need to decide whether you will be looking for a loan with a fixed, adjustable or variable interest rate. In order to determine, you need to know the differences between these types of interest, and know the pros and cons of the two mortgage types.

1) Adjustable/Variable Mortgage Rates

An adjustable rate home loan implies that the monthly payments will deviate along with the interest rate variation that the market dictates. Thus, if the interest rate rises on the market, you will be paying a higher installment because the portion of the payment that’s made of interests will increase.

When you complete a loan application, this type of mortgage will offer a decreased interest rate. With time the interest rate may growth or it may go down even more. As the amount you will pay depends on the variations of the market, this kind of loan is for those who are used to planning, foreseeing coming situations and preparing for them.

These types of mortgages also let you to apply for greater amounts and longer periods. This is why you need to be prepared to face many variations on the monthly payments. In any case, if something happens that prevents you to keep up with this system you can always refinance your home loan and opt for a fixed rate.

2) Fixed Interest Rates

For the whole period of the home loan you will consistently be paying the same interest rate with a fixed rate mortgage. The debt is paid in identical monthly installments. The main value you will get from this type of loan is that you will not need to worry about an increase on the monthly payments. Even if the rates charged for home loans vary in the market, you will be paying the same amount every month.

This is specially designed for home buyers that are not willing to allow monthly payments to alter after a period. Those who have a fixed income and prefer to be safe by knowing the amount of money they will be paying for the home loan for the years to come.

If you you have anxiety over the possibility of a changing mortgage payment, or you will not be able to make ends meet, then you should definitely go for a fixed rate home loan as it is the most predictable option.

In conclusion, the choice of which type of manufactured home home loan which best suits your needs must be answered according to your present financial situation, your expected income and your conservative or adventurous nature. You should also verify what experts are predicting will happen with the market in the upcoming years. Nevertheless, you should always have some savings and credit available for unexpected events. The Best way to avoid a fall is to stay away from the edge. Having enough savings can let you dismount advantage of decrease variable rates and save thousands of dollars while still being safe.

The 5 Essentials for Manufactured Home Financing

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CMHI has formed a list of 5 important prerequisites to obtaining mobile and manufactured home financing. To satisfy the five essentials for real property lending on manufactured housing:

I. The home is installed on a state approved permanent foundation system.
II. The home is, in fact, converted to a fixture upon the underlying real estate.
III. The home is architecturally compatible with homes in the immediate neighborhood. This includes exterior elevations, garages, decks, porches and, where appropriate, landscaping.
IV. The interior amenities and quality level meet or exceed those found in homes in the immediate neighborhood.
V. The appraisal fairly and accurately establishes the value based on existing or new construction in the immediate neighborhood.

Why to Avert a Foreclosure on your Mobile Home

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Mobile Home owners often fail to see that the consequences of a foreclosure are very unlike those of a Manufactured Home short-sale. A short sale might be one great alternative deserving serious consideration.

What Effects Your Credit Score?

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Everyone has a credit score, whether they know it or not. Your credit score is used by lenders to asses the risk involved with lending to you. By now, you are probably wondering  what your credit score is. Getting your credit score is very easy, and free if you cancel the service right after getting your score. One of the most popular credit score websites is Free Credit Report, you have probably seen one of their obnoxious commercials. The next question is how your credit score is formulated, which is a big secret, but we do know some of the really important factors:

  • Payment history (35%). Your score is negatively affected if you have paid bills late, had an account sent to collection, or declared bankruptcy. The more recent the problem, the lower your score — a 30-day late payment today hurts more than a bankruptcy five years ago.
  • Outstanding debt (30%). If the amount you owe is close to your credit limit, that is likely to have a negative effect on your score. A low balance on two cards is better than a high balance on one.
  • Length of your credit history (15%). The longer your accounts have been open, the better.
  • Recent inquiries on your report (10%). If you have recently applied for many new accounts, that may negatively affect your score. Promotional inquiries don’t count.
  • Types of credit in use (10%). Loans from finance companies generally lower your credit score. FICO says this is most important when there isn’t a lot of other information upon which to base a score. Although this is a good guide as to what credit scoring companies deem important, keep in mind that some companies may consider different factors.

As long as you keep on top of these five considerations, your credit score should be respectable, and when you need to get financed for a Chevy Camero, new pool and Spa, Apple computer, or  mobile home loan, you should be deemed lendworthy.

Banks Remain Tight on Lending Standards

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Lenders are Tight on Home Loans

Lenders are Tight on Home Loans

“Domestic banks indicated that they continued to tighten standards and terms over the past three months on all major types of loans to businesses and households,” the Federal  Reserve’s survey of senior loan officers said.

Looking ahead, the Fed said most banks plan to keep lending standards tighter than average levels over the past decade, but that should be expected given the reputation lenders made for themselves leading up to the subprime crisis.

This is definitely expected, however very unwelcome. These tight standards that banks now hold themselves to can only be compared to a farmer that depletes all the resources from the soil as fast as possible, then blames the grocery store for their loss in livelihood. The banks have been taking supreme advantage of the loose legislation for half a decade, and they are very irresponsible for doing so. Now, the hens have come home to roost, and the banks are acting irresponsibly in the other direction. Lenders are finding phantom reasons to decline even the lowest risk loans.

In an economy that the banks are majorly responsible for ruining, they are now proceeding to decline America by acting reactively and not responsibly. A retired American with a good bank account, credit score and income cannot get a loan to purchase a manufactured home, even though Berkshire Hatheway recently came out and said that they are a lower risk than a traditional home loan.

Banks and their irresponsible tight lending practices are sending ripples throughout an already brittle economy, and the ripples are effecting the working and retired alike.

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.

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.