Obtaining Manufactured Home Loans Using the Title I Program

Homeowners can obtain manufactured home loans using the Title I program. The Title I program, in conjunction with the Federal Housing Administration, allows approved lenders to provide funding to borrowers for purchasing or refinancing a manufactured home. A manufactured home is a home that is pre-assembled and placed on a lot. The FHA does not provide the funding, but guarantees the loan for a lender, should a borrower default. The home must be the primary residence of the borrower. The loan amount will vary depending on what type of structure is being financed. There are three types of structures available for financing under the Title I program: manufactured home, lot or a manufactured home and lot. The term limits also vary.

Eligibility

Under the Title I program, both the borrower and the home have eligibility requirements. As previously mentioned, the home for purchase or refinancing must be the primary residence. In addition, the borrower must be able to provide the required down payment, provide a income source, and have a suitable site in which the manufactured home will be installed. The home itself must meet manufactured homes installation standards, carry at least a one-year warranty, and have a suitable site in which utilizes can be connected and adhere to local standards.

Applying

When a borrower is applying for the manufacturing home loan, it is important to make that the lending institution is on the approved lenders list with FHA. If the lending institution is not an approved lender, the borrower can find a complete listing of approved lenders on the HUD website.  The lender will review the borrower’s credit history and ability to repay the loan.

Approval

Once a lender approves the loan, the borrower can then contact a seller to purchase the home. If the borrower does not have a home in mind, they can research to find the right home. The home must adhere to HUD installation standards as well local and state codes applicable to installation and construction. The borrower will have to sign a HUD Placement Certificate. This certificate verifies that the installation was completed satisfactorily and to installation standards. Should the borrower feel that work was incomplete, they should contact their local HUD office for assistance.

Repayment

The repayment terms of the loan are outlined in the contract. Interest rates on the loan are fixed, over the life of the contract. The life of the loan ranges from 12 to 20 years, depending on the type of property being financed. There are no penalties imposed for prepayment, or early payoff of the loan.