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The laws governing the ownership of mobile and modular homes are quite different from those relating to traditional homes. This is primarily because the homeowner does not own the piece of land on which the home rests for any length of time. In addition, most banks and other lending institutions are reluctant about offering mortgages for mobile homes. However, there are specialist lenders who may allow you to take out a traditional loan product for this category of homes.
It is sensible to ensure that you have a reasonable amount of money to invest as a down payment when buying a mobile home. Unlike usual mortgages, interest rates on loans for mobile homes are considerably higher. It is ideal to put a large deposit towards the purchase of the home and take as little a loan as possible. It is also advisable to appraise your credit score before applying for the loan. The lender will decide on the amount of loan by evaluating the aspects of the credit report.
Since mobile, or manufactured, homes tend to depreciate with time, you may find it difficult to get a good offer. Even so, it is crucial to approach several lenders to obtain a financially viable option. You may use the services of a specialized broker dealing in loans for modular or mobile homes. This may help you to come to a decision, after studying all the options available. A visit to a broker does not obligate you to buy a loan product from him.
If you find a particular offer acceptable for your situation, do not agree to it immediately. Negotiate with the lender or broker to improve the offer. It is a common practice with most lenders to raise the interest rates. You can get a particularly good bargain, if your credit score is high.
Determine from the lender the exact amount you would have to repay each month. Ask whether there are penalties for prepayments, should you decide to pay off the loan early. Be sure to find out if the monthly payments could include insurance or other hidden costs.
It is advantageous to discuss the loan product with a professional person who is not connected with the mortgage industry. A property attorney may give neutral advice regarding loans for mobile homes. Review all documents with a reputable attorney before finalising the deal.