A mobile home is often a large investment or asset for many people as well as being their home. Sometimes it may need to be refurbished or the owner needs a lump sum of money for another investment. Or they simply want to get a better interest rate on their current mortgage. In this case they wonder if they can refinance their mobile home to serve this purpose. This article will discuss how to get a mobile home refinance and some of the issues concerning it.
First up when it comes to financing, there is a difference between a mobile home and a manufactured home. A mobile home is any dwelling built prior to the 1976 US Department of Housing and Urban Development (HUD) Code enactment. The 1976 HUD Code is essentially a set a stringent requirements on the construction of the mobile/manufactured home. It was designed to ensure that there was some uniform quality control over manufactured homes being built. This included a high standard in plumbing, heating, fire and wind resistance, and that the home was transportable.
Mobile Homes that are pre 1976 are pretty hard to get refinance on because they don't adhere to the HUD guidelines. There are institutions that will lend on this type of home but the lending criteria to satisfy the refinance will be strict.
Even with manufactured homes after 1976, the standards for refinance and mortgages in general is higher than a stick built house. General guides are that you need a credit score of 640 or more. The loan to value of the refinance will be a maximum of 95% but normally will be around 80%. The home has to be owner occupied.
The refinance rates will not only depend on your personal financial history but on the type of manufactured home. For example, the size of the home may be a factor. Whether it is single wide or double wide determines how it can be moved and can influence the interest shown by lenders. If the land that the manufactured home resides on is owned by the owner this will affect the type of loan you are applying for.
If you don't own the land, the loan will be described as a chattel loan. This effectively means that the manufactured home is not real estate but a movable piece of property. A manufactured home on land is generally worth more than if it was on rented land and will be easier to refinance.
There is increasing interest by lenders in manufactured home refinance and mortgages because more people are attracted to these types of homes as traditional house prices get out of reach of the average family income. This bodes well for manufactured or mobile home owners because increased competition means better products and better interest rates. Shop around before you decide on a mobile home refinance.
Find more details on manufactured home refinance at http://www.homerefinancenloans.com/ Adrian Whittle writes on ideas for generating finance for all types of homes and financial situations, including second mortgage refinance.
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