What Is A Mobile Home Park Loan
Mobile home park financing is basically a term covering the commercial mortgages used to purchase land that falls under the categories of mobile homes, RV rental parks, seasonal parks and even camping grounds in some areas. Some types of manufactured homes that are semi-permanently set in the park can also qualify for commercial mortgage loans. Residents might even be able to lease the land from the park owner for their manufactured home.
And the land owner can get a mortgage against the specific plot underneath the mobile home plus the common areas and even structure elements. There are several options for mobile home park financing, so be sure to chat with a Venus Capital loan specialist to see which how your scenario can be handled.
Here at Venus, we dont specialize in construction loans for mobile home parks, but it is something that can be accomplished for the right qualified buyer.
Mobile Home Park Financing
- Owning a mobile home park has become an attractive investment opportunity for seasoned property owners and newcomers alike, thanks to a number of creative financing options available.
- As with any kind of financing, the type of loan you get for mobile home park financing will depend on what you qualify for and the type of real estate youre buying.
Manufactured Home Community Financing Handbook
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Wells Fargo specializes in financing Manufactured Home Communities , offering various flexible lending programs to meet your needs. Our experience and dedication to this industry has made Wells Fargo a nationwide leader in MHC financing for more than 15 years.
Our products and services include:
- Loan programs: Freddie Mac, Fannie Mae, balance sheet, CMBS lending, correspondent lending.
- Flexible terms: Typically 3- to 10-year terms, floating- or fixed-rate, with longer maturities available.
- Amortization: Typically 30-year schedules. Interest-only available on a case-by-case basis.
- Loan to value: Up to 80% for acquisitions 75% for cash-out refinances.
- Interest rates: Floating and fixed interest rates set at competitive spreads. Early rate lock typically available on fixed-rate loans.
- Liability: Typically non-recourse to borrower, except for the standard carve-outs.
- Closing process: Typically within 45 to 60 days from receipt of a complete loan application from borrower.
For more information on how Wells Fargo can help you finance manufactured home communities, contact one of our specialists, or contact us.
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Why Get A Mobile Home Park Financing
Do you own a mobile home park? If so, then the time has come to get mobile home park financing. A lot of people are unaware of rent-to-own homes for sale in Mobile, Alabama. With these types of homes, you can provide your tenants with an affordable alternative to renting or owning a house or apartment. There is no such thing as too much money when it comes to investing in property management and its important that you know how long your business will last before deciding what type of financial plan is best for you. The amount of income generated by properties like this one can be very lucrative and there are many benefits that come along with getting into the industry if its something that interests you.
How To Qualify For Mobile Home Financing
Financing a mobile or manufactured home is a little different from financing a house because most lenders do not consider these homes eligible for most types of mortgage. Some lenders will give you a loan for a manufactured home if it meets their specific requirements and rests on a permanent foundation, but often it is difficult or impossible for manufactured homes to be considered real property, especially if you dont own the land under your home.
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Department Of Agriculture Programs
Housing assistance programs began in the New Deal era when the government wanted to provide better homes for the rural population. The programs were administered by the USDA because the programs were geared toward on-farm housing.
The best thing about a USDA loan is that there is no down payment required. When you wonder how to buy a mobile home with no money down, think USDA. You are also allowed to finance 100% of the homes appraised value.
The house must meet geographical requirements, but that doesnt mean you have to live 20 miles from your nearest neighbor. About 97% of the U.S. land mass is USDA loan eligible, an area encompassing 109 million people.
Interest rates fluctuate with the market but are usually less than conventional loans. The downside to a USDA loan is a Guarantee Fee of 2% is added to the total loan amount, and an annual fee of .5% gets added to your monthly payment.
The minimum credit score to qualify is 640. And unlike traditional mortgages, you can be disqualified for making too much money. The maximum limit is 115% of the median income for the county or area you want to live in.
Check with your bank or credit union to see if they can help you with a USDA loan application for a manufactured loan.
Heres a quick look at the features of a USDA Manufactured Home Loan:
- No down payment required
Venus Capital Make It Easy For Investors
When Venus Capital loans money, they make sure to have fast turnarounds. They will release hard-earned funds after a signed loan agreement is in place without any hassle. This means that you can take advantage of valuable opportunities before the property goes up on sale for much more than its initial price tag!
With a high quality customer service team, well handle everything on the loan side to move you forward quickly. From the moment you start your application until its time for payment, our trained representatives are available all hours of the day with helpful answers and personalized solutions tailored just for you.
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Best Mobile Home Loans Of 2022
- Best for Bad Credit: 21st Mortgage Corporation
- Best for Low Down Payment: eLend
- Best for Manufacturers Financing: Vanderbilt Mortgage and Finance
Available in all 50 states, Manufactured Nationwide offers mobile home loans with low credit score and down payment requirements and flexible loan terms.
Good for borrowers with fair credit
Available in all 50 states
Competitive fixed rates
Not available for homes on rented land or in mobile home parks
Construction loans suspended
Closing process may be long with some programs
Manufactured Nationwide is a division of Magnolia Bank which was founded in 1919. The company is our best overall mobile home lender because it lends in all 50 states and is an expert in low-down-payment, government-backed loan programs.
Manufactured Nationwide offers single-, double-, and triple-wide manufactured, mobile, and modular home loans for new and used homes. Its government-backed loan programs, such as the VA, FHA, and USDA provide competitive fixed-rate mortgages to this segment of the housing market.
It has a program that lend up to $1.5 million on purchases. Credit scores for the VA loan must be at least 620. The same is normally true for the FHA program, but they can work with people with no score in some cases. Manufactured Nationwide’s down payment requirements range from zero down for their VA and USDA programs to little money down for the FHA program.
Terms for the loans are 15, 20, or 30 years.
How We Obtain And Use Information
We collect personal information from customers and maintain former customer records to: We will gather and disclose personal information only as allowed by law. We maintain rigorous security practices to safeguard your personal information. We are committed to delivering quality financial services that meet your needs. If we do not offer a particular financial product or service, we may, from time to time, join with carefully selected financial partners to offer that product or service to you. We will not disclose personal information about you to offer non-financial products and services. We believe that you are entitled to meaningful choices about how personal information about you will be disclosed.
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How Much Do Mobile Home Loans Cost
How much your mobile home loan costs depend on variables like loan amount, loan type, and interest rate. Your interest rate will likely be the most expensive cost, ranging from 2.5% for a VA or USDA loan to over 12% for a non-government-backed loan.
A down payment is another cost to consider. Some loan programs offer zero down payments or down payment assistance if you qualify. Other loans require anywhere from 3.5% to 35% of the purchase price as a down payment.
If youre financing a mobile home on a leased lot, you will need to consider how much the land is costing you and how much youre paying for utilities and mobile home insurance.
Figure Out The Specifics Of The Home That You Want To Purchase
The type of home youre looking for will affect the loans you may be eligible to receive. For example, if you want to buy a double-wide manufactured home that costs $100,000 or more, you wont be eligible for an FHA loan. In addition, older mobile homes may not qualify for financing at all.
Why its important: All lenders have specific lending criteria based on the type and value of your home.
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What Is A Mobile Home Park
A mobile home park, also known as a trailer park or a manufactured home community, is a temporary or permanent location where mobile and manufactured homes can be parked.
The best thing about mobile home parks is that you will have access to community amenities, such as pools, laundry facilities, fitness centers, recreation areas, and more. Some communities are age-restricted, meaning they only allow residents of a certain age group. For example, a mobile home park could be exclusively for senior citizens looking for a retirement community to reside in. On the other hand, some communities welcome anyone who wishes to live in a mobile or manufactured home.
Wrap Mortgages On Mobile Home Parks
Another construction that is popular with mobile home parks are wrap mortgage, which means that the buyer essentially assumes the first lien without telling the bank that they are doing so. These type of arrangements allow the buyer to skirt any type of bank committee or credit check, but include an element of risk, should the lender discover the property has been conveyed without their approval. In those cases, the loan can typically be called due and payable, and might lose your down-payment. So be careful with this financing type. In some cases, the underlying loan allows for a wrap, or a construction that acts as a wrap, so you should have a licensed attorney read the note and see what is, and is not, allowed.
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Get In Touch With Us Now
Clopton is a national commercial mortgage broker in the business of matching borrowers involved in multifamily, industrial, commercial, and mixed-use real estate to lenders suited to their needs for asset-backed funding. Needs invariably include purchasing, refinancing, or rehabbing a property. Irrespective of your direction, our commercial mortgage loan officers will connect you to the best commercial loans at the most competitive rates and easiest terms available. We work every day with private investors, small/middle market real estate entities, and family offices everywhere in the US investing through partnerships, trusts, corporations, LLCs, Delaware Corporations, estates, and even as foreign nationals.
Understand The Cost Of A Mobile Home
According to the U.S. Census Bureau, the average price of a new mobile home was $118,700 in July 2021. The average price for a single-wide was $76,000 and the average price for a double-wide was $137,800.
When applying for a mobile home loan, there are several different costs that you should keep in mind. These include any required down payment, as well as the cost to rent or purchase land. Down payments typically range from 10% to 20% of the total cost of the home, although some programs offer loans to borrowers with even lower down payment requirements. Other costs to consider including closing costs and fees associated with the loan.
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Pros & Cons Of Manufactured Home Financing
With advances in manufactured home technology and decreased manufactured home prices, mobile homes are becoming increasingly popular. With that said, manufactured home financing can be tricky, especially if you are a first-time buyer.
There are many different types of loans to choose from, and the prices vary greatly, so it is important to do your due diligence before deciding which one is right for you. Here are some tips for finding a mobile home.
So, lets weigh the pros and cons of manufactured home financing:
Apply For A Mobile Home Loan
Before you apply for a mobile home loan, there are a few steps youll need to take. You should first obtain an estimate for the loan amount you need, which will depend on the total cost of the mobile home youre interested in purchasing or building. Youll also need to decide on what type of mobile home loan you want to pursue. Some government-backed loan programs like VA or FHA loans, may have lower down payment requirements.
Before you apply for a loan, you should make sure that you have enough saved up for a down payment and that you meet certain minimum credit score and debt to income ratio requirements. If possible, you should see if there are any loans that you can pre-qualify for without affecting your credit. Be sure to secure quotes from multiple different lenders so that you can compare rates and get the best deal possible.
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Master Lease With Option
A master lease with option is a type of real estate deal that only exists within the MHC or MHP financing world. Its generally reserved for parks that have been run very poorly and cant get any kind of financing because it would be too risky. In a master lease with option, you agree to pay the seller a flat monthly rate for a set number of years, and you have the option to buy the park at a set price during that time. If youre willing to put in the hard work of cleaning up a property, raising rents, and cutting costs, this can be a good option to own a park in the long-run or even sell it to a third-party. Its lower risk for you as well, because if you cant get the park into a better condition, you can still walk away at the end of the term.
Ready To Finance A Mobile Home Park
At Wilshire Quinn Capital we control the lending process and can provide fast answers and quick closings for your mobile home park loans. We are a direct lender which means we can fund mobile home park loans fast. We lend private hard money loans for mobile home parks nationwide to $20M with funding available in about 5-7 days.
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Types Of Mobile Park Ownership
- One type of proprietorship includes the borrower owning the parcels on which the mobile homes stand. The land encompasses the following: pools, roads, utility frameworks, club houses, and different amenities. In this type of proprietorship, the owner owns the land with added amenities to attract tenants who will lease out one of the mobile parks lots. In this form of ownership, the owner doesnt own any of the mobile homes. These investors are focused on creating a stream of income from tenants looking for a place to live in their mobile home or lease their mobile home.
- The other type of proprietorship includes the borrower owning the parcel, all the amenities, and the mobile homes. In this situation, the owner intends to cash flow from the actual tenants living in the mobile homes standing on the property.
What Is A Mobile Home Loan
A mobile home loan is a loan for factory-built homes that can be placed on a piece of land. Styles may vary from modest trailers to dwellings that look like houses attached permanently to the land upon which they sit.
Mobile home loans differ from a traditional property loan because most lenders and counties do not consider them real property, but rather personal property. In fact, in many counties, a mobile home is taxed by the department of motor vehicles rather than the property tax assessor. In most cases, if you want to buy a mobile home and place it on land that you lease, your loan will more closely resemble a personal loan, with higher interest rates and shorter terms than a traditional home mortgage.
There are exceptions, however, and weve included them in this list. Some home lenders do have loans for mobile homes if they are attached to the homeowners land. Others, and there are fewer of them, will lend on a mobile home even if it sits on land you lease.
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What’s The Minimum Credit Score Needed For A Mobile Home Loan
Keep in mind that if you want a mobile home loan, you will need to meet some minimum qualifications. If the mobile home is attached to property that you own, you might qualify for a government-backed loan with a minimum FICO score of 500. However, credit score requirements vary by lender and loan type, and may be as high as 620 or even 680. Talk with your lender about their requirements before applying for a loan.