Manufactured Home Financing In Colorado

Mobile vs. Manufactured Homes

A manufactured home is a prefabricated housing produced in a factory and then carried on a trailer chassis to its permanent location. The primary distinction between mobile and prefabricated homes is the date of construction. A factory-made home before June 15, 1976, is a mobile home, whereas one built after that date is a manufactured home, according to the Department of Housing and Urban Development (HUD). Manufactured houses are designed under the national HUD code and must meet stringent construction, safety, and energy efficiency standards. Modular homes, however, are built following all applicable state and local building codes, much like traditional site-made homes.

Another distinction between the two is that manufactured homes can be relocated, whereas modular homes are usually built on a permanent foundation. Furthermore, manufactured homes are frequently less expensive than site-built homes and offer several design alternatives.

Modular vs. Manufactured Homes

Modular homes are built following all applicable state and local building requirements. They are typically installed on a permanent foundation, whereas manufactured homes are made in accordance with the national HUD code and can be moved. Because of the manufacturing process, modular homes may offer fewer design alternatives.

Types of Manufactured Homes

There are several different types of manufactured homes, each with its own unique characteristics and features. Some of the most common types of manufactured homes include:

• Single-wide homes: 

These are the most common type of manufactured homes, typically 14-16 feet in width and up to 80 feet long. Single-wide homes are typically more affordable than other types of manufactured homes and can be a good option for those on a tight budget.

• Double-wide homes: 

These are larger than single-wide homes, typically 20-24 feet wide and up to 80 feet long. Double-wide homes offer more living space and may be a good option for families or those who need more room.

• Triple-wide homes: 

These are the largest type of manufactured home and can be up to 48 feet in width and up to 80 feet long. Triple-wide homes offer even more living space than double-wide homes and may be a good option for large families or those who need a lot of space.

• Park model homes: 

These are smaller than traditional manufactured homes and designed for temporary or seasonal living. Park model homes are typically less than 400 square feet and can be a good option for those who want a smaller, more affordable living space.

Manufactured Home Financing Options

There are various ways to finance a manufactured house, each with its benefits and drawbacks. Some of the most prevalent methods of financing a manufactured home are:

• Chattel mortgage: 

This type of loan is specifically designed for manufactured homes and involves the home serving as collateral. Chattel mortgages typically have higher interest rates than traditional mortgages and may require a larger down payment.

• Personal loan: 

This loan is not secured by the home and may have a lower interest rate than a chattel mortgage. However, personal loans may be more challenging and have shorter repayment terms.

• FHA loan: 

The Federal Housing Administration (FHA) offers a loan program specifically for manufactured homes. FHA loans may have lower down payment requirements and offer more flexible credit requirements than traditional mortgages.

• VA loan: 

The Department of Veterans Affairs (VA) offers a loan program for manufactured homes for eligible veterans and active-duty service members. VA loans may offer lower interest rates and may not require a down payment.

• Conventional mortgage: 

Some lenders offer conventional mortgages for manufactured homes, although these may be more difficult to obtain than other types of financing.

Fannie Mae’s MH Advantage and Freddie Mac’s Choice Home programs are both intended to increase access to affordable manufactured home financing choices. There are, however, some significant differences between the two programs:

• Eligibility requirements: To be eligible for the program, MH Advantage homes must have specified construction and design elements, such as specific external and interior features that make the homes more equivalent to site-built homes. On the other hand, Choice Home residences must meet specified building and quality criteria, but no specific design characteristics are necessary to qualify for the program.
• Minimum down payment: MH Advantage houses demand a 3% down payment, whereas Choice Home homes require a 5% down payment.
• Loan terms: MH Advantage loans can last up to 30 years, while Choice Home loans can last up to 25 years.
• Loan limits: MH Advantage loan limits vary by location and are generally greater than Choice Home loan restrictions.

The key differences between these financing options are interest rates, down payment requirements, and credit requirements. Chattel mortgages typically have higher interest rates and may require a larger down payment, while FHA and VA loans may have lower down payment requirements and flexible credit requirements. Personal loans may have lower interest rates but may be more challenging to obtain. Conventional mortgages may be difficult to obtain.

In summary, there are several different ways to finance a manufactured home, each with its own advantages and disadvantages. The best option will depend on individual financial circumstances, credit history, and other factors.

Apply for a Manufactured Home Financing in Colorado

Because manufactured house loans are deemed high-risk, many lenders avoid them. The good news is, we don’t! Capital Home Mortgage offers manufactured home financing, including a construction-to-permanent option with a one-time closing. 

Our Home Loan Specialists are always available to answer your inquiries regarding our Colorado Manufactured Home Loan options. We may be reached at (303) 226-1177.