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Have a question? Ask our Home Buying expert.

Have questions? Email Send your question to mlerner@smartasset.com

All About VA Loans for Mobile Homes

The home-buying process can seem exciting and daunting at the same time. There are many hoops that you’ll have to jump through and many homes that you’ll have to consider. If you’re trying to save money, purchasing a mobile home might make sense. But if you’re planning to use a VA loan, you’ll need to make sure the house you want is eligible for the program. Here’s the lowdown on how veterans can use VA loans for mobile homes.

Find out now: How much house can I afford?

What Is a Mobile Home?

The terms mobile home and manufactured home are often used interchangeably. But they’re technically two different things. According to the Department of Housing and Urban Development (HUD), mobile homes are structures that were built prior to June 15, 1976. Manufactured homes, on the other hand, are structures built after that date. Unlike mobile homes, manufactured homes must meet certain HUD standards regarding the way they can be constructed.

Under the VA loan program, however, mobile and manufactured homes are considered one and the same. For VA loan purposes, a mobile (or manufactured) home is any house that’s built in a factory on a permanent frame called a chassis. A modular home, on the other hand, is built in sections in a factory. Then, it’s transported to a designated site where it’s put together and placed on a foundation.

In order to qualify for a VA loan for a mobile home, you’ll need to meet certain criteria. These requirements vary from those for traditional single-family homes and modular homes.

VA Loan Requirements for Mobile Homes

All About VA Loans for Mobile Homes

If you want a manufactured home because you like the idea of having a home that’s mobile, you’re out of luck. In order to be eligible for financing through the VA loan program, a mobile home must be attached to a permanent foundation. Mobile homes must also adhere to local building codes, zoning rules and minimum property requirements (MPRs). These rules ensure that a property is safe to live in. So homes with leaky roofs and inadequate heating won’t qualify for loans backed by the Department of Veterans Affairs.

Additionally, a mobile home must be classified as real property. In other words, it can’t be considered a vehicle (that’s personal property). If the mobile home you’re purchasing hasn’t been moved to a permanent location, you’ll need to provide your lender with details regarding how it will be installed.

If you own a plot of land, you can use a VA loan to buy a mobile home for that lot. You can also use a VA loan to purchase both a mobile home and land at the same time. But the kind of financing that’s available to you can vary depending on your circumstances. Veterans who want VA loans for mobile homes will need to submit to a credit check and meet income requirements.

VA Loan Terms for Mobile Homes

Most VA loans have 30-year repayment terms. But the maximum term for VA loans for mobile homes is much shorter.

For narrow, single-wide mobile homes (purchased with or without a plot of land), the maximum loan term is 20 years and 32 days. For double-wide mobile homes, it’s 23 years and 32 days. If you’re buying a double-wide mobile home and a lot, the maximum loan term is 25 years and 32 days. 

Challenges to Obtaining a VA Loan for a Mobile Home

All About VA Loans for Mobile Homes

Obtaining a VA loan for a mobile home won’t be easy. Homeowners with mobile homes are more likely to default on their loans. That’s one reason why many lenders avoid issuing VA loans for mobile homes.

Getting approved for a VA loan for a mobile home can be more challenging if you have a low credit score. In addition to building your credit, you may have to shop around until you find a lender who’s willing to finance your mobile home purchase.

Even if you can find someone who’s open to giving you a loan, it may only be a short-term construction loan. If that happens, you’ll have to go through the process of refinancing and applying for a VA home loan once your home has been constructed.

Bottom Line

Buying a mobile or manufactured home can save you money. But securing the financing you need through the VA loan program will be difficult. Furthermore, finding a home that meets the requirements listed by the VA and your local government can be challenging.

Photo credit: ©iStock.com/motorider, ©iStock.com/demaerre, ©iStock.com/MivPiv

Elizabeth Stapleton Elizabeth Stapleton is an attorney and freelance writer focusing on personal finance and entrepreneurship. Her expertise includes home buying, retirement and taxes. Elizabeth lives in North Carolina.
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