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Manufactured Home Financing

Find out how the VA program works with manufactured homes.

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Manufactured Homes

What is a manufactured home?

A manufactured homeis a type of housing that is built off-site in a factory and then transported to its final location. These homes are constructed in compliance with federal building codes administered by the U.S. Department of Housing and Urban Development (HUD). Unlike traditional site-built homes, manufactured homes are designed to be easily transported and are typically placed on a permanent foundation. They come in various sizes and styles, offering a more affordable housing option for many individuals and families. While they share some similarities with modular or prefabricated homes, manufactured homes are distinct in their construction process and adherence to specific HUD standards.

Advantages

Affordability: Manufactured homes are often more budget-friendly than traditional site-built homes, making homeownership accessible to a broader range of individuals and families.
Energy Efficiency: Many modern manufactured homes are designed with energy-efficient features, such as insulated windows and energy-efficient appliances, contributing to lower utility costs for homeowners.
Quality Control: Manufactured homes are built in a controlled factory environment, ensuring a higher level of precision and quality control compared to on-site construction. This can result in a more durable and well-constructed home.

Disadvantages

Depreciation: Manufactured homes, whether new or existing, tend to depreciate in value over time, unlike traditional site-built homes that may appreciate. This can impact resale value.
Financing Options: Financing for manufactured homes, especially older ones, may be more challenging to secure, and interest rates could be higher compared to traditional stick built home loans.
Resale Challenges: Selling an existing manufactured home may pose challenges, as there may be a limited pool of potential buyers, and the perception of depreciation may deter some.
Maintenance Costs: Older manufactured homes may require more maintenance and repairs, and finding replacement parts for specific features could be challenging if they are outdated or obsolete.
Perception and Stigma: There can be a stigma associated with manufactured homes, and some potential buyers may have negative perceptions about their quality and durability, impacting resale opportunities.

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Restrictions

Manufactured homes can be one of the more difficult types of homes to finance compared to any traditional built home or condo. There are some specific restrictions any Veteran looking for a manufactured home should be aware when considering this type of property.

Double and single wide homes are acceptable but must be built after June 15, 1976

Double and single-wide manufactured homes built to a national HUD building and safety standard and are permitted for VA financing. Each manufactured home built after June 15, 1976 is required to have a HUD label affixed to the exterior of each unit. If a HUD label cannot be located, an IBTS report will have to be completed to obtain all the identifying information. Manufactured homes built prior to are considered mobile homes and are extremely difficult to finance.

Permanent Foundation

It is necessary for the manufactured home to be placed on a permanent foundation, which can come in various forms such as a solid concrete slab, sturdy cider blocks that are reinforced with tie downs, or a system of jacks and piers that are anchored into the ground with concrete. The foundation not only supports the weight of the home and its contents, but also provides stability and protection against natural disasters such as floods or wind.

Fee Simple

Ownership in the land the manufactured home is affixed to needs to come with the property. This is also known as fee simple. If the manufactured home is in a park or on leased property, it’s categorized as chattel and ineligible for VA financing through Community First National Bank.

Maximum Acreage

There isn’t a maximum acreage restriction when it comes to the VA loan. We’ve processed numerous transactions with 100+ acres.

Affidavit of Affiliation

Manufactured homes are initially considered personal property until a crucial legal process known as the affidavit of affixation is executed and submitted to the relevant legal authorities in the state where the property is situated. Upon satisfactory completion of this procedure, the manufactured home is then assessed and taxed as real property, hence aligning it with the requirements for mortgage financing. The affidavit of affixation is essential in transforming the legal status of the manufactured home, bringing it in line with real estate property in terms of classification, valuation, and taxation.

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