Buying a mobile home offers plenty of advantages. For starters, they are much cheaper than your conventional home. You’ll also have the flexibility to select your floor plan, layout, and any special features that your heart desires.
Like most homeowners, you’ll likely have to finance your mobile home from http://www.solitairehomes.com/ in order to claim title to it if you don’t have enough cash to cover the entire purchase. Luckily, you’ve got plenty of options when it comes to financing your mobile home to make payments comfortable and easy for you! Consider the following options:
Conventional Bank Mortgages
The traditional way to get a mortgage is to approach your bank or lender to secure the money needed to purchase your mobile home. This method involves completing and submitting a mortgage application, whereby certain requirements need to be met, such as having a good credit score, an income that will cover the mortgage and your other debts, and a down payment.
FHA and VA Mortgages
Conventional mortgages typically require at least 5% down. In fact, any less than a 20% down payment with the mortgage will require you to pay Private Mortgage Insurance (PMI), which is an additional payment that protects the lender should you default on your mortgage. If you don’t have at least 5% to put down, you may be able to qualify for an FHA- or VA-backed mortgage, which offers less stringent requirements compared to conventional mortgages.
Land in Lieu Financing
Rather than having to come up with a down payment in the form of liquid cash, you can use your land as your down payment. An increasing number of buyers are choosing this option in lieu of coming up with cash as a down payment. With this option, the land serves as collateral for the mortgage. It should be noted that appraised value of the land have an effect on the down payment.
This loan involves the purchase of the home’s structure only, and not the land. Down payments range between 5% to 20%, depending on your credit score.
What Affects Your Ability to Secure a Mortgage For Your Mobile Home?
There are a few factors that impact your eligibility to get approved for a mortgage for your mobile home.
Credit Score – Lenders will have a look at your credit score to determine what they believe is your ability to pay back a loan on time and in full each month.
Income – You will need to show written proof that you are making a steady income enough to cover your mortgage as well as all the other debts that you may be carrying. If you are employed with a company, you’ll need to submit your W-2’s and paycheck stubs. If you are self-employed, you will likely have to submit at least two full years of your income tax statements.
Debt-to-Income Ratio – This number represents the amount of your income that goes towards paying off your debts, including the mortgage that you are applying for. The lower the number, the better the chances of you getting approved.