While less expensive, the financing process for manufactured homes can be challenging for buyers, and this guide explains key factors to be aware of when it comes to home buying.  

Conventional Mortgages Are Not Usually an Option for Manufactured Homes 

When buying a stick-built home, most people apply for a home loan to secure the property. With manufactured homes, lenders are less likely to provide a loan. That’s because these properties are typically lower in cost, which makes them less advantageous to lenders when it comes to interest fees.  

What Types of Loans Are Available for Manufactured Homes? 

While buyers can’t usually get conventional mortgages, there are other types of loans that can be used to purchase a manufactured property: 

• Federal Housing Administration (FHA) Loans – The FHA offers Title I and Title II loans to mobile and manufactured home buyers. Title I loans can cover the purchase of just the property, while Title II loans can cover the home and the land it’s being erected on. 

• Fannie Mae/Freddie Mac Loans – Fannie Mae and Freddie Mac are what’s known as government-sponsored enterprises and their goal is to keep housing markets affordable. These programs can also help people purchasing manufactured homes and may only require a small down payment in some cases.  

• Personal Loans – Personal loans can be sought through one’s bank or credit union, or they can be procured from other lenders. Interest rates may be a bit higher depending on the lender, so it’s important to do your research before agreeing to loan terms.  

Regardless of which type of loan works best for you, there are some steps you can take to boost your chances of getting approved. Review your credit score prior to applying for loans to see where you stand and carefully consider your budget when deciding on an appropriate loan amount.  

We Can Help Las Cruces Home Buyers Find the Property of Their Dreams 

Fiesta Homes has helped home buyers throughout Las Cruces find amazing properties thanks to our wide selection of floor plans. However, we also provide information on financing packages to ensure home ownership is within reach of all families, regardless of budget. Call 575-525-4680 for more information or contact us today.  

Tax Rates and Costs

States determine the tax rates for manufactured homes. Some states tax them as vehicles, while other consider them real property and tax them as such.

In New Mexico, many manufactured homes are taxed as permanent structures, similar to as-built homes in the state. This is the case when the home is attached to a permanent foundation and the tongue and axel have been removed, if applicable. New Mexico’s current tax rate is 0.78%, with the median annual property tax payments being $1,403.

Utility Costs

Unless your home is located on a mobile home park, which typically provide utility hook ups to tenants for a recurring cost, you will be responsible for accessing utilities on the plot of land where your home is located. Common utilities include gas and electric, which may already be present on the plot of land you choose. If not, you must schedule installation to prepare land for your home.

Water is another consideration. If there is no municipal supply available, you must have a well installed on your property. You will be responsible for installation and maintenance costs, but you won’t be subject to a monthly water bill.

You’ll also need to access telephone and internet service. Unless you choose a plot of land in a highly isolated area, you will likely be able to access these services easily. However, depending on where you live you might be restricted to one type of service based on what’s available.

Utility costs will be similar to as-built homes in New Mexico, provided you don’t incur additional costs for installing lines or digging wells. While it depends on the size of your home and your household, average costs in the state hover around $239 per month.

Fiesta Homes can help you realize your dream of homeownership at a price you can afford. Our customers can choose from a wide selection of floor plans and layouts, which accommodate a variety of budgets and family sizes. We’ll also help you secure financing, including land and home packages for your convenience.

Home buyers in Las Cruces are welcomed to call (575) 525-4680 for more information. You can also contact us with any questions about our homes or the financing process.

While it can be a great decision, you must enter into the process fully informed. This guide explains a few important things to consider before making a down payment on the mobile home of your dreams.

1. Answer Some Basic Questions

If you know friends or family who currently own mobile homes, talk with them about their experience. You should also ask yourself the following questions:

• How many bedrooms/bathrooms will you need?
• Are there certain features you can’t go without?
• Do you want a single, double, or triple-wide home?
• Is green construction and sustainability important to you?
• Do you plan on staying in one place for a while?

2. Look for a Suitable Location

You have two location options for your mobile home. You can lease space in a mobile home park, or you can set up on your own plot of land. Mobile home communities are great for families, as they usually offer common areas and fun activities. You may also have the option to buy the land you’re leasing at some point in the future.

If you have dreams of being a landowner and leading a more solitary lifestyle, you may want to purchase a plot of land outright. This process is more complex, as you may need to deal with things like road construction and utility installation. It’s also more expensive, but it’s more than worth it if you have it your budget.

3. Consider Your Financing Options

Financing a mobile home isn’t like financing a traditional home. You can secure a land and home financing package, which combines the costs of the home and the land you’re purchasing into one package. If you’re only purchasing the home and leasing in a mobile home park, you can apply for a traditional mortgage. Depending on the price of the home you’re buying, you may be able to apply for a personal loan, which cover smaller amounts of money.

We Can Answer Your Questions

No matter where you are on your mobile home buying journey, Fiesta Homes is here to help. We understand what a big decision buying a mobile home is, so we’ll guide you through every step of the process. We’ll answer your questions about mobile vs. manufactured homes, help you find the perfect floor plan, and even provide info on financing options. Please call (575) 525-4680 to speak with a friendly and knowledge representative or contact us for more information.

It’s clear that manufactured homes have much to offer, which is why so many people are choosing them over traditionally constructed homes. However, they may not be the right choice for everyone. This guide explains some of the benefits and drawbacks of manufactured homes so you can make the best possible decision for your housing needs.

Pros of Manufactured Homes

Financial issues can sometimes render the dream of ownership out of reach. This is especially true for those who live in areas with high housing costs, who will have a difficult time finding a home that’s within their price range. Manufactured homes are typically more affordable in general, with some estimates showing they’re 10% to 20% less expensive than conventionally built homes. 

Manufactured homes can also be built with energy-efficient, environmentally friendly materials, and some homes even receive Energy Star certification for the entire structure. Energy Star certifications are afforded by the Environmental Protection Agency to home appliances that are more energy efficient. That means they cost less money to operate and are better for the environment.

Manufactured homes can also help you save money in other ways. Because these homes are more affordable, you have more money available for customization. There are a variety of floor plans, colors, materials, and features to choose from. Many homes also have luxury options, such as hardwood flooring and marble countertops. Making alterations to an existing home or building it from the foundation up is far more expensive in comparison.

Cons of Manufactured Homes

Of course, you’ll need somewhere to put your new home, and land selection can pose an issue for some people. Even if you find a suitable plot of land, it may be restricted to the building of conventional homes only. Site preparation can also be laborious and may cost more money as a result. The good news is that the trend towards manufactured and modular homes in recent years is making land selection less of an issue.

While the unique construction of manufactured homes offers increased efficiency and affordability, it can also have an impact on your financing options. Some lenders classify these homes as personal property as opposed to real estate, which means you may not be able to go the typical financing route of applying for a mortgage. You can apply for a personal property loan in this case, but the terms might not be as favorable.

We’ll Walk You Through the Decision-Making Process

Fiesta Homes has specialized in manufactured and mobile homes for more than two decades. As a result, we can answer tough questions about financing, land selection, and what features will work best in your brand-new home. We also strive to keep our services affordable, so that our clients feel confident in securing the homes of their dreams.

If you’d like more information on purchasing a home in Las Cruces, NM, feel free to call (575) 525-4680 today. You can also contact us online to learn more.

Real Vs. Personal Property

First and foremost, you need to determine if your prospective home is real or personal property. If your home is personal property, which is the case if the building is on wheels or you pay fees to the DMV, then it does not qualify for a home loan. However, if the home is at least 400 square feet, situated on an approved foundation and taxed as real property, it may qualify as real property and therefore be eligible for a government-backed mortgage loan.

If your home does not qualify for a home loan, don’t fret. You may still be able to apply for a personal loan. In fact, applying for a personal loan is easier than applying for a mortgage, and the approval times are much quicker.

Mobile, Manufactured or Modular

Though consumers use the three terms interchangeable, lenders don’t. In fact, how you categorize a home can make or break your eligibility for financing. For instance, mobile homes, which are factory-built homes, were constructed prior to the development and implementation of housing regulations. Because of this, many do not meet critical safety standards, and most lenders are reluctant to finance them.

Manufactured homes, like mobile homes, are moveable. However, their construction was dictated by the National Manufactured Housing Construction and Safety Standards Act of 1974, meaning they meet most of today’s safety standards. That said, their movability makes some lenders hesitant to finance them, though not all.

Lenders are most willing to finance modular homes, which are factory-built homes assembled on-site and that adhere to all the same local building codes as site-built homes. These homes are more permanent in nature than manufactured homes, as they’re generally built on concrete foundations. For all these reasons, you’re more likely to obtain financing if you wish to buy a modular home.

Types of Loans Available

Now that you know what factors lenders consider when deciding whether or not to finance a manufactured or modular home, it’s time to discuss loans. Below are a few types of loans that may be worth looking into:

• Chattel Loans: When it comes to financing a manufactured home in Las Cruces, a chattel loan is your best bet. This type of loan is for the home only, as opposed to loans for both the home and the land. Because a chattel loan is technically a personal property loan, loan amounts are generally smaller. However, even though you’re borrowing less with a chattel loan, your monthly interest rates may be higher than if you were to pull out an actual mortgage. The terms on chattel loans are shorter as well, with repayment terms of just 15 to 20 years.
• FHA Loans: There are two types of FHA loans you can use for modular homes: FHA Title I and FHA Title II loans. A Title I loan is a personal property loan while a Title II acts more like a mortgage. To qualify for either loan, the structure must have been built after June 15, 1976, and comply with local building codes and the HUD code. You must also have a fairly decent credit score.
• Government-Backed Loans: Aside from a chattel loan, a government backed loan may be your best option for borrowing. If you qualify, you can receive backing from a lender who has a repayment guarantee from the U.S. government. Per this guarantee, if you default on the loan, the government will step in and pay the lender.
• VA Loan: If you served in the U.S. military, you may be able to go through the VA for financing. However, to finance a modular home through the VA, your home must be permanently attached to a foundation, be your primary home and meet the HUD code. You must also purchase the land your home sits on as well as the home’s title.

If you don’t qualify for any of the above types of loans, you’re not completely out of options. Many mobile home manufacturers and retailers offer financing directly through them. This makes it easier for customers to buy. Lenders that specialize strictly in mobile and manufactured homes may also be willing to help, as they’re more familiar with modular homes and the purchase process.

When you purchase a home from Fiesta Homes, we can guide you toward the best form of financing for your current situation and budget. Contact us today to learn more about financing options and how we can help you find the home of your dreams.