VA Manufactured Home Loans
What is the definition of a Manufactured Home under the VA program?
VA loans can be used to purchase a mobile home or manufactured home. These are prefabricated in a factory before being moved in sections for construction on site. To qualify for a VA loan for a manufactured home, the recipient must be planning on living in the property on a permanent basis; as such, it should come complete with all necessary sanitation, cooking, and sleeping facilities.
All manufactured homes should display a tag that confirms they meet the U.S. Department of Housing and Urban Development regulations and codes. These tags are commonly referred to as a HUD tag and confirm that the property is classified as a mobile home. It is essential for you to recognize the difference between manufactured homes and other residential properties because many VA lenders will not be prepared to award loans to veterans against manufactured homes.
It is also important to note that VA lenders distinguish between modular homes and manufactured homes. While sections of a modular home are constructed in a factory before being relocated to the site, they still require some work on the site itself. Some lenders do issue loans against modular homes; however, it is vital that you understand that the loans that are available for both modular homes and manufactured homes are often not as attractive as standard VA homeowner loans. For example, lenders may require a down payment against the property and interest repayments may be higher because mobile homes do not typically hold their value as well as other forms of residential property.
What Forms of VA Loans are Available for Manufactured Homes?
Provided you meet the loan requirements, you may be able to secure a VA-backed loan for the following purposes:
- To purchase a manufactured home and/or a plot on which to construct it.
- To purchase and enhance a plot on which you wish to place a manufactured home that you already own and reside in.
- To refinance a manufactured home as a means of purchasing a plot.
- To refinance a loan that you already have for a manufactured home as a means of reducing your interest rate.
To qualify for a VA loan, the manufactured home needs to have permanent foundations.
What Factors Should Veterans Take into Consideration When Selecting a Site for a Manufactured Home?
If you plan on positioning the manufactured home on land that you already own or are planning on purchasing, make sure you take into consideration the ease with which you can access the facilities you will need to sustain everyday life. If you will not have access to a public or community water service or sewage system, verify that the property will have access to the subsoil conditions you will need to install your own sewage system and well and ensure you are aware of the full cost of doing so.
What are the Loan Repayment Terms for Loans Secured Against Manufactured Properties?
Veterans can take a VA loan out against a manufactured property as follows:
- Single-wide unit or a combination single-wide unit and accompanying lot: 20 years, 32 days.
- Double-wide unit in isolation: 23 years, 32 days.
- Double-wide unit and accompanying lot: 25 years, 32 days.
- Lot only on which to place a pre-owned property: 15 years, 32 days.
If I Sell my Manufactured Home, Can I Assume the VA Loan?
Yes. However, if you took out your VA loan after March 1, 1988, you will be required to request an approval of the assumption and liability release from the lender. If you took out your VA loan before March 1, 1988, you could assume the loan without seeking prior approval from the loan holder. However, in the case of the latter, you will typically remain liable for the loan unless you apply to the VA for a formal release from liability, which you will need to receive in writing.
Can I Receive More Than One VA Manufactured Home Loan?
Yes. If you are eligible for restoration of entitlement or have sufficient remaining entitlement to purchase a second manufactured home and no longer own the prior manufactured home.