Getting Approved For Used Mobile Home Loans in 2023

Buying a used mobile home can be an affordable way to become a homeowner. Used mobile homes often cost much less than site-built homes. However getting financing for a used mobile home can be tricky. Used mobile home loans have higher interest rates and stricter requirements than loans for site-built homes. With the right preparation and research, you can get approved for a used mobile home loan.

How Used Mobile Home Loans Work

Used mobile homes are considered personal property, not real estate. That means used mobile home loans function more like car loans or personal loans rather than mortgages. Here are some key features of used mobile home loans

• Higher Interest Rates – Expect to pay 3-5% higher interest on a used mobile home loan than a mortgage for a site-built home. Lenders view it as a riskier investment.

• Shorter Loan Terms – Used mobile home loans typically have maximum terms of 20 years Some lenders cap terms at 15 years

• No Pre-Approvals – It’s difficult to get pre-approved for a used mobile home loan. Lenders need to assess the value of the specific home before approving financing.

• Down Payment Required – Expect a 10-20% down payment requirement. It’s rare to find zero down payment used mobile home loans.

• Loan Amounts – Used mobile home loans range from $10,000 to $200,000 depending on the value of the home. Newer and larger homes qualify for higher loan amounts.

Tips for Getting Approved

Getting approved for a used mobile home loan requires extra planning and preparation. Here are some tips:

• Have a down payment ready – Lenders like to see at least 10-20% down to reduce risk. Save up as much as you can.

• Own the land – Loans are easier to get if you own the land the home will be placed on. If not, have a long-term lease agreement for a mobile home park.

• Improve your credit – Aim for a credit score over 640. Pay down debts and dispute any errors to boost your score.

• Lower your debt-to-income ratio – Lenders look for ratios below 43%. Pay off credit cards and other debts.

• Find a newer model home – The newer the home, the easier it is to get financing. Look for a home built after 1990.

• Get the home appraised – An appraisal shows the true value and condition. Make any repairs needed before applying for financing.

• Shop multiple lenders – Compare interest rates, fees, and eligibility criteria from multiple lenders.

Top Lenders for Used Mobile Home Loans

These lenders stand out when it comes to offering used mobile home loans:

21st Mortgage

• Loans for used mobile homes up to 20 years old
• No minimum credit score requirement
• Can finance homes in mobile home parks
• Interest rates from 8-14%

Dealer Sales

• Manufactured home dealers offer in-house financing
• Easy to bundle home and land purchase
• Limited financing options based on dealer relationships

United Finance

• Minimum credit score requirement of 500
• Used mobile homes can be up to 35 years old
• Loans up to $150,000
• Competitive interest rates from 5-12%

Axos Bank

• Minimum credit score of 600
• Low minimum loan amounts of $10,000
• Terms up to 240 months
• Low down payment options for borrowers with good credit

Mid America Mortgage

• Minimum credit score of 600
• Loans for used mobile homes up to 20 years old
• Offers VA, FHA, and USDA financing options
• Interest rates as low as 3% with government-backed loans

What to Expect During the Application Process

The process of applying for and obtaining a used mobile home loan takes 1-2 months. Here’s an overview of what to expect:

• Get pre-qualified – While not a full pre-approval, this shows what loan amounts and rates you may qualify for.

• Find a home – Once pre-qualified, you can confidently start shopping for a used mobile home in your budget.

• Start official application – You’ll provide financial documents, undergo credit checks, and fill out a detailed application.

• Get appraisal done – The lender will send out an appraiser to evaluate the home’s value and condition.

• Receive final approval – It takes 1-2 weeks to hear back on final loan approval after underwriting review.

• Close on the loan – Closing day involves signing all paperwork and securing the down payment.

The key is being prepared financially, shopping smart, and applying with the right lender. While the process takes time and effort, it’s possible to get approved for a used mobile home loan with the right strategy. Taking these steps can help you finally achieve your dream of affordable homeownership.