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Financing & Investment Questions
Is a factory built-home a good investment?
Generally, a home is a great investment. Appreciation on any home - either site-built or manufactured - is affected by the same factors: the desirability and stability of the community, supply and demand for homes in the local market, and maintenance and upkeep of the home. When properly installed and maintained, today’s manufactured homes will appreciate the same as surrounding site-built homes, making manufactured a very sound investment!
What are options for financing my new factory-built home?
Just as there are choices when you buy a site-built home, there are a variety of financing options for manufactured home buyers. Down payments and loan terms are similar – 5-10 percent of the manufactured home’s sales price for a down payment and loan terms of 15-30 years.
If you are buying a home and land together, or plan to place the home on land you already own, some financial institutions offer traditional real estate mortgages with similar interest rates. If you purchase your manufactured home separately from the land on which it will be located, the home will most likely be financed as a personal property manufactured home loan, usually with a higher interest rate.
FHA-insured and the Department of Veteran Affairs – guaranteed (called FHA and VA) – loans are available to manufactured home buyers. These types of loans may offer lower interest rates or lower down payment requirements. If available in your area, they require more paperwork during the credit application and approval process and, therefore, may take longer for approval than a conventional loan.
How do I find financing?
Your retailer can most likely arrange financing. However, if you prefer, you may choose to contact an NMMHA Member Lender or finance your home through an outside lender, bank or credit union.
What Is The Role Of The Retailer In Purchasing A Manufactured Home?
Most manufactured homes are sold through retail sales centers, many of which are independently owned and operated. Others are owned and operated by a manufacturer. In some states, you may also buy from a manufactured home community owner, developer, or if you’re purchasing a previously owned home, a real estate agent.
Retailers offer a variety of products and services, including helping you customize the home to fit your needs and budget. Typically, the retailer is also responsible for coordinating the delivery and installation of your home. Furthermore, the retailer can assist in arranging financing and insurance coverage for the home. And, once you’ve moved in, the retailer is often the contact for warranty service.
Given similar size and style, a manufactured home costs less than a comparable conventionally built home. Why?
A manufactured home is constructed on an assembly line. It is done inside a building so that Mother Nature didn't have the opportunity to rain on your floor decking or your studs before the roof was put on. Also, the workforce that constructs manufactured homes enjoy the same dry warm/cool workplace that your home does so they can be more productive in what they do. They also do the same portion of the home assembly every day. Therefore, they can be trained to do that particular job well. Random drug testing is also used to insure both the quality of the product produced and the safety of the workers in the plants.
Do manufactured homes appreciate in value as do conventionally built homes?
In general, manufactured homes will appreciate at the same market rate as other homes in the same neighborhood, but, as with all housing, it is subject to the same market factors which affect appreciation. The factors that impact future value include: the housing market in which the home is located; the community in which the home is located; the initial price paid for the home; the age and maintenance of the home; the inflation rate; the availability and cost of community sites; the extent of an organized resale network, etc. When properly installed and maintained, today’s manufactured homes will appreciate the same as surrounding site-built homes.
What can I afford?
NMMHA Member Lenders will meet with you to “pre-qualify” you for your mortgage (if you’re placing your home on private property) or for your consumer installment loan (if you’re placing your home in a land-lease community). He or she will work with you to determine your budget, give you an idea of your borrowing capacity and down payment requirements, and determine the monthly payment you feel comfortable with. That monthly cost will then be translated into the price of a home.
What other costs can I expect to pay?
While your home loan payment may be your biggest expense, you’ll have other regular payments. They may include utilities, property taxes, land-lease fees, insurance, routine maintenance and other service fees such as water and sewer. Today’s manufactured homes are built to meet new national energy standards set by the Department of Housing and Urban Development. These standards ensure that your home is well insulated and help reduce your monthly energy costs.
Will buying a manufactured home offer tax benefits?
Manufactured homes are not only affordable, they also represent a good investment. Financing your manufactured home will allow you to take a tax deduction for your interest cost. In addition, there are numerous tax benefits for home-buyers who buy an energy efficient manufactured home.
Click Here for a complete list of tax benefits!
Will I be able to insure my manufactured home?
Yes. There are several insurance companies that specialize in offering insurance coverage for manufactured homes.
Generally, a home is a great investment. Appreciation on any home - either site-built or manufactured - is affected by the same factors: the desirability and stability of the community, supply and demand for homes in the local market, and maintenance and upkeep of the home. When properly installed and maintained, today’s manufactured homes will appreciate the same as surrounding site-built homes, making manufactured a very sound investment!
What are options for financing my new factory-built home?
Just as there are choices when you buy a site-built home, there are a variety of financing options for manufactured home buyers. Down payments and loan terms are similar – 5-10 percent of the manufactured home’s sales price for a down payment and loan terms of 15-30 years.
If you are buying a home and land together, or plan to place the home on land you already own, some financial institutions offer traditional real estate mortgages with similar interest rates. If you purchase your manufactured home separately from the land on which it will be located, the home will most likely be financed as a personal property manufactured home loan, usually with a higher interest rate.
FHA-insured and the Department of Veteran Affairs – guaranteed (called FHA and VA) – loans are available to manufactured home buyers. These types of loans may offer lower interest rates or lower down payment requirements. If available in your area, they require more paperwork during the credit application and approval process and, therefore, may take longer for approval than a conventional loan.
How do I find financing?
Your retailer can most likely arrange financing. However, if you prefer, you may choose to contact an NMMHA Member Lender or finance your home through an outside lender, bank or credit union.
What Is The Role Of The Retailer In Purchasing A Manufactured Home?
Most manufactured homes are sold through retail sales centers, many of which are independently owned and operated. Others are owned and operated by a manufacturer. In some states, you may also buy from a manufactured home community owner, developer, or if you’re purchasing a previously owned home, a real estate agent.
Retailers offer a variety of products and services, including helping you customize the home to fit your needs and budget. Typically, the retailer is also responsible for coordinating the delivery and installation of your home. Furthermore, the retailer can assist in arranging financing and insurance coverage for the home. And, once you’ve moved in, the retailer is often the contact for warranty service.
Given similar size and style, a manufactured home costs less than a comparable conventionally built home. Why?
A manufactured home is constructed on an assembly line. It is done inside a building so that Mother Nature didn't have the opportunity to rain on your floor decking or your studs before the roof was put on. Also, the workforce that constructs manufactured homes enjoy the same dry warm/cool workplace that your home does so they can be more productive in what they do. They also do the same portion of the home assembly every day. Therefore, they can be trained to do that particular job well. Random drug testing is also used to insure both the quality of the product produced and the safety of the workers in the plants.
Do manufactured homes appreciate in value as do conventionally built homes?
In general, manufactured homes will appreciate at the same market rate as other homes in the same neighborhood, but, as with all housing, it is subject to the same market factors which affect appreciation. The factors that impact future value include: the housing market in which the home is located; the community in which the home is located; the initial price paid for the home; the age and maintenance of the home; the inflation rate; the availability and cost of community sites; the extent of an organized resale network, etc. When properly installed and maintained, today’s manufactured homes will appreciate the same as surrounding site-built homes.
What can I afford?
NMMHA Member Lenders will meet with you to “pre-qualify” you for your mortgage (if you’re placing your home on private property) or for your consumer installment loan (if you’re placing your home in a land-lease community). He or she will work with you to determine your budget, give you an idea of your borrowing capacity and down payment requirements, and determine the monthly payment you feel comfortable with. That monthly cost will then be translated into the price of a home.
What other costs can I expect to pay?
While your home loan payment may be your biggest expense, you’ll have other regular payments. They may include utilities, property taxes, land-lease fees, insurance, routine maintenance and other service fees such as water and sewer. Today’s manufactured homes are built to meet new national energy standards set by the Department of Housing and Urban Development. These standards ensure that your home is well insulated and help reduce your monthly energy costs.
Will buying a manufactured home offer tax benefits?
Manufactured homes are not only affordable, they also represent a good investment. Financing your manufactured home will allow you to take a tax deduction for your interest cost. In addition, there are numerous tax benefits for home-buyers who buy an energy efficient manufactured home.
Click Here for a complete list of tax benefits!
Will I be able to insure my manufactured home?
Yes. There are several insurance companies that specialize in offering insurance coverage for manufactured homes.