Manufactured Home Loans In New Mexico

What is a Manufactured Home?

A “manufactured home” is a single-family residential unit built after July 15, 1976, constructed in a factory in sections following the Federal Manufactured Home Construction and Safety Standards.

A manufactured home, as defined by HUD, is a structure constructed in accordance with the Manufactured Home Construction and Safety Standards (HUD Code) and displaying a red certification label on the exterior of each transportable section. The design and construction of a manufactured home must adhere to the Federal Manufactured Construction and Safety Standards and have a permanent chassis. It is at least 400 square feet and intended for use as a habitation with a permanent foundation constructed according to FHA standards.

HUD standards and regulations ensure that manufactured homes adhere to quality and safety standards, including fire resistance, energy efficiency, electrical wiring practices, and heating systems. The HUD Code for manufactured homes was enacted on June 15, 1976, and it applies to structures built on or after that date.

Manufactured, Mobile and Modular Homes

Mobile homes are prefabricated homes constructed before June 15, 1976, whereas manufactured homes are those built after that date. On June 15, 1976, the U.S. Department of Housing and Urban Development established new construction standards for pre-built homes, giving birth to this distinction. After this date, dwellings had to comply with the HUD Code and are referred to as manufactured homes.

Manufactured homes are typically constructed with more durable materials than mobile homes, typically built with lighter-weight materials. Moreover, if necessary, manufactured homes can be relocated with a qualified manufacturing home moving company’s assistance.

The main difference between a modular and a mobile home lies in how they are built and the codes they adhere to. Modular homes are built in large pre-assembled sections and then pieced together at the site, while mobile homes (also known as manufactured homes) are built entirely at the factory and then shipped in one piece to the site. Modular homes are constructed according to all applicable state and local building codes, similar to traditional site-built homes. On the other hand, mobile homes are built to the national HUD code, set by the Department of Housing and Urban Development.

Another key difference is that mobile homes have the potential to be moved, whereas modular homes are built on permanent foundations. Modular homes are placed on private property, while mobile homes can be placed on private property or within mobile home parks. Additionally, the cost of manufactured homes is generally lower than that of modular homes, with estimates ranging from $40 to $50 per square foot for manufactured homes and starting around that level but potentially reaching $100 per square foot or more for modular homes.

Manufactured Home Financing In Florida

• Fannie Mae MH Advantage

The Fannie Mae MH Advantage program is a homeownership option that provides innovative and affordable financing for specially designated manufactured homes featuring site-built characteristics. The program aims to offer increased financing options for manufactured housing and close the gap between affordable housing and traditional site-built residences.

MH Advantage offers flexible underwriting standards and reduced pricing for manufactured homes that meet specific construction, architectural design, and energy efficiency standards. Homes eligible for MH Advantage must be built according to specific design criteria. Fannie Mae has agreements with manufacturers that allow them to apply an MH Advantage sticker to multi-width manufactured homes meeting these criteria.

Qualified applicants may finance up to 97 percent loan-to-value (LTV) through the MH Advantage program. The program provides financing options for both MH Advantage homes with site-built features and single-width manufactured homes that are more affordable. MH Advantage is intended for something other than low-income consumers, with typical loan amounts between $200,000 and $250,000.

• Freddie Mac ChoiceHome 

The Freddie Mac CHOICEHome program is an innovative, cost-effective mortgage initiative that provides conventional site-built financing for real-property factory-built homes constructed in accordance with the HUD Code and featuring site-built characteristics.

CHOICEHome is a new type of high-quality manufactured home, built to HUD code but developed with site-built features. The program is designed to provide more options and credit flexibility for very low-to-low-income borrowers, helping them achieve homeownership with a down payment as low as 3%.

• FHA Title I Program

Under the Title I program, FHA-approved lenders finance purchasing or refinancing a manufactured home and lot using their own funds. FHA protects the lender from loss in the event of borrower default. Credit is extended based on the applicant’s credit history and capacity to repay the loan in monthly installments.

FHA does not make loans; it insures loans to incentivize mortgage lenders to lend. Title I manufactured home loans are not loans or grants from the federal government. The negotiated interest rate between the borrower and lender must be fixed for the entire loan term, typically 20 years.

A Title I loan may be used to purchase or refinance a manufactured home, a developed lot on which to locate a manufactured home, or both. The dwelling must serve as the borrower’s primary residence.

For Title I insured loans, borrowers are not required to purchase or own the land on which they will position their manufactured home. Borrowers can instead lease a lot, such as a site lot in a manufactured home community or mobile home park. HUD requires the lessor to provide the manufactured resident with a three-year initial lease term when the land/lot is leased. In addition, the lease must stipulate that the householder will receive at least 180 days’ written notice before the lease’s termination. These lease provisions safeguard householders if the lessors sell the land or close the park.

• VA Loan for Manufactured Homes

Veterans and military members can use their VA loan benefits to purchase a manufactured (mobile) or modular home through the VA manufactured home loan program. VA-guaranteed financing may be used for a variety of manufactured home-related purposes, including:

• Purchasing a manufactured home and lot; 
• Purchasing and enhancing a lot to put a manufactured home you already own and occupy;
• Refinancing a manufactured home loan to buy land;
• Refinance an existing VA loan for a manufactured home to lower the interest rate.

Borrowers with VA home loans can purchase a mobile or manufactured home without purchasing land to place it on or purchasing both the home and land. When a creditor wishes to buy a mobile home and put it on land they already own, the loan amount may include the home’s purchase price.

VA manufactured home loan applicants must meet minimum credit score, income, and down payment requirements like other mortgage loans.

Apply for a Manufactured Home Loan in New Mexico

Numerous lenders avoid manufactured home loans because they are regarded as high-risk. Fortunately, we do not! Capital Home Mortgage provides financing options for manufactured homes, including a construction-to-permanent option with a single closing. 

Our Home Loan Specialists are always available to answer questions about our Florida Manufactured Home Loan options. You can reach us at (505) 448-8884.