4 Requirements to Get a Mobile Home Loan

Mobile home loans finance the purchase of a mobile home similar to how mortgage loans finance the purchase of a permanent facility. Any time you seek a loan, you will be evaluated on some basic criteria to determine your potential to repay the loan on time. By assuring you meet these requirements, you can guarantee you will find a good loan at a low rate.

Good Personal Credit

Your FICO score will be the first criteria evaluated for any loan. This is a metric on how you have performed on your past loans, including: making monthly payments, paying off loans on schedule and maintaining appropriate balances on your credit lines. All of your past loans will be evaluated. If you have any loan defaults within the statute of limitation, the period of time when a default may remain on your record, you may be denied a loan.

Solid Asset Base

You may want to use collateral in order to secure your mobile home loan at a better interest rate. Secured loans are traditionally cheaper for the borrower. However, even if you elect to have an unsecured loan, having a good debt to asset ratio will get you a loan faster and at a lower rate. Having too much debt may be a reason for a lender to reject your loan application.

Stable Income

You should have an income high enough to easily make the monthly payments on your loan. It is best if you have maintained employment with the same employer for at least two years with a consistently increasing salary. If you have just changed jobs or just started a business, you may need to secure the loan against an asset in order to receive your financing. New business owners particularly are considered risky borrowers because of the uncertainty of their endeavor. 

Down Payment

A down payment is required on most mobile home loans. If you provide at least 20% down payment, you may be eligible for lower interest rates and savings on your home insurance. Many borrowers will use the proceeds from selling another mobile home or residence in order to provide a down payment. While 100% financing is an option, most lenders will not extend a loan under these conditions. Those that do extend 100% financing loans will charge you much more in interest rates and give you unfavorable loan terms. 

Complete Application

Your application is the only thing a lender will see about you in most cases. Treat your application like a job application. This means it should be neat, 100% complete with no missing information, and submitted on time in the form the lender asks. If you are on the fence about whether you will be approved for a loan, you need to be particularly careful with your application. Providing supplemental information about your character or financial history may be necessary in order to assure a lender you are trustworthy. Even if you have good credit, it is important to remember you are in competition with other borrowers from your loan. Take this opportunity to stand out and differentiate yourself.

 


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