Stewardship Capital

Manufactured, Mobile and Modular Home Loans

Not every factory-built home is financed the same way. The words manufactured, mobile and modular mean different things to a lender. So does the question of whether you own the land. This page explains the differences in plain words.

What is the difference between modular and manufactured homes?

Both are built in a factory. The difference is the building code. A modular home is built in sections to the same local building codes as a site-built home. The sections are set on a foundation at your lot. Lenders usually treat a modular home much like a regular site-built home.

A manufactured home is built to a federal code called the HUD code. It has a metal tag on the outside and a data plate inside that prove it. The term mobile home usually means a home built before the HUD code began in 1976. Those older homes are very hard to finance.

What is the difference between chattel and real property?

What is a chattel loan?

A chattel loan is a loan for the home only, treated as personal property, like a vehicle. It is common when the home sits on rented land, such as a space in a park, or when the land is not owned with the home. The rules for these loans are different from a regular mortgage.

What is a real property loan?

A real property loan finances the home and the land together as real estate. For this, the home usually must be permanently attached to land that the buyer owns. The home is often on a permanent foundation and the title is set up as real estate. This path is closer to a regular mortgage and may have more program choices.

Which loan programs can finance a manufactured home?

Several programs have manufactured home rules. They include FHA, VA, USDA and some conventional programs. Each program has its own list of requirements. Rules for the age of the home, size, foundation and location differ and change. Stephen confirms them on your file. Our VA loans page explains VA basics.

What does a lender need to see for a manufactured home?

Expect extra paperwork about the home itself.

• Proof that the home meets the HUD code, such as the tags and data plate
• Title records that show whether the home is personal property or real estate
• A foundation certification, which some programs ask for
• An appraisal by someone who knows manufactured homes
• Land records if the land is part of the loan
• Park or lease information if the home is on rented land

What about the land under the home?

Land ownership changes the loan. If you own the land, a real property loan may be possible. If you rent the space, a chattel loan is more likely. If you are buying a home and the land together, the home may need to be tied to the land first. The county records and title company play a key role. Realtors can help by asking for the title and tag details early.

What about a home in a manufactured home park?

Many manufactured homes sit in parks where the owner rents the space. In that case, a chattel loan is more common. The lender may look at the park lease, the park rules and the condition of the park. Some programs have extra rules about homes on leased land. Others will not finance them at all.

Also ask whether the loan is for a main home, a second home or a rental. Some programs only allow a main home. The rules vary, and Stephen confirms them before you commit.

How can I get ready?

Gather the home's year, tag numbers, title and any foundation records. Know whether the land is owned or rented. Then talk with Stephen before you write an offer. Matching the right loan to the home saves time. Our Buy a Home page covers the steps, and loan limits by county shows limits by county.

This is not a quote, a commitment to lend or an offer of credit. Stephen Chakerian, NMLS #2193331 | Stewardship Capital, a team of Barrett Financial Group, L.L.C., NMLS #181106 | Equal Housing Opportunity.