There are around 18 million Americans living in mobile homes or manufactured homes according to the U.S. Census Bureau. This accounts for around 5% of the entire US population. One of the main reasons why people are living in this kind of arrangement is obvious: mobile homes are cheaper compared to conventional on-site fixed houses, they are mobile and can be in any location, are low-maintenance and upkeep, and are subject to different housing laws.
It is obvious that mobile homes have bigger advantages than conventional homes for a single family, but buying and financing mobile homes has its own hurdles and different challenges. Getting a mortgage for a mobile home is not the same as getting one for a conventional home and we are here to explain.
With mortgage rates continuing to rise and the cost of real estate at a record high in most of the United States mobile home Buyers are in need of different ways to pay for their mobile home within the greater Sarasota Florida area.
Where can a mobile home Buyer go to get financing for a mobile home on leased land in Florida?
Does financing even exist?!
This is an important topic to discuss but first, we need to fully understand what type of mobile home we are looking to finance so we can best understand the financial obstacle that needs to be overcome.
Mobile homes in Florida that are located within a mobile home park where the owner of the mobile home pays lot rent are viewed as and taxed as personal property within the state of Florida.
The sale and purchase of these dwellings have titles associated with them and not deeds as traditional single-family homes do.
If this sounds quite a bit like the Buyer is purchasing a vehicle then you are correct!
Since this purchase is unique to many folks, we are here to give you the 3 most common ways a mobile home in the greater Sarasota Florida area can be financed below.
Buying a mobile home on leased land in the form of cash is by far the most common way to buy. When we say cash we are not referring to physical dollar bills, but rather cashier’s checks or money orders. This type of purchase amounts to over 90% of all home sales state-wide and is one that is often preferred by the Seller of the mobile home.
In traditional mortgages, your major lenders will not lend on a mobile home in Florida when it is located on leased land. The reason is that these homes do not qualify as real estate because the home does not include the land in the sale of the property. If you are looking at obtaining a mortgage for your mobile home purchase you will need to go to a third-party mortgage underwriter who specializes in mobile home loans with properties located on leased land.
3. Seller Financing
It is not uncommon to encounter a Seller who is willing to play banker with you as a Buyer. Here, the Seller will require some type of down payment to move into the property and monthly installment payments that will be credited toward the remaining balance of the home. Although this is not the most common financing method we see it is certainly one to inquire about from the start to see if the Seller is willing to work with you on a payment system.
If none of the above options is right for you, there are other ways to acquire a mobile home through different types of loans.
Chattel loans work similarly to traditional mortgages in that your mobile home can be seized if you fail to pay your mortgage on schedule. The good thing about a Chattel loan is that your house doesn’t need to be affixed permanently. Chattel loans can be used whether you own the land or rent a lot.
There are many types of personal loans but because most of them don’t require collateral, the interest is always higher compared to traditional loans. There are also secured personal loans if you want a lower interest. Some loan companies accept mobile homes as collateral for personal loans.
Borrowing money from your family, friends, and relatives can be another option if none of the above fits your situation.
One of the many great things about buying a mobile home on leased land is that there are several different ways to purchase and move into your new property that is not normally available to single-family homes.
Having several different options and being educated in all of them will certainly put you ahead of the curve when looking at buying your new mobile home!
Although all of the above options can help you acquire a mobile home, it is always important to plan ahead before planning to move into a mobile home. Most people who avoid paying interest plan two to three years in advance. This gives them enough time to save money to buy a mobile home.
Finally, there are a few different ways to finance a mobile home. You can take out a personal loan, get a loan from a mobile home dealer, or finance the home through a bank or credit union.
Personal loans are one option for financing a mobile home. You can get a personal loan from a bank, credit union, or online lender. The interest rate on a personal loan is typically higher than the interest rate on a mortgage, so you’ll need to carefully consider whether this is the right option for you.
Another option is to finance your mobile home through the dealer where you purchase the home. Mobile home dealers often work with banks and other lenders to offer financing options to their customers. The interest rates on these loans are usually higher than those of personal loans, but they may be easier to qualify for.
Finally, you can also finance your mobile home through a bank or credit union. These institutions typically offer more favorable terms than either personal loans or dealer financing. However, it may be more difficult to qualify for financing from a bank or credit union than it is from other sources.
The Mobile Home Dealer is a licensed mobile home dealer and broker in Sarasota Florida and neighboring areas. We provide professional buy and/or sell assistance to our clients. If you have any questions, please contact us by clicking this link. You may also visit our Facebook Page and send us a message.
This is Mark Kaiser with The Mobile Home Dealer and we help mobile home Buyers and Sellers get to a better place in life.