What Is A Delaware Manufactured Home Loan?

With housing prices being above several hundred thousand dollars, it can seem like a huge decision to buy a home. It’s a large investment – there’s a chance that it will take years to save up enough to afford a traditional home in Delaware. Manufactured homes are more affordable (typically) than homes that were built on site and are therefore more financially accessible. They also come in a variety of styles and options, giving homeowners a more traditional home feel for less. The John Thomas Team can help you navigate the Delaware Manufactured Home Loan – give us a call at 302.703.0727 or Apply Online to get started.

New home shipments of manufactured homes have been increasing since 2011. Nearly 18 million Americans live in some sort of manufactured dwelling. Manufactured homes are built on chassis – think of a car and steel base with wheels and axles. All Manufactured homes today are built on HUD code. Once they reach a permanent location, the wheels, hitch, and axles come off. At that point the site is prepped, you’re connected to utilities, your home is removed from the chassis and is put on permanent foundation.

What is the Difference Between Mobile, Manufactured, and Modular Homes?

When discussing Delaware Manufactured Home Loans, it’s important to understand the three types. What many people think of as a “mobile home” is most likely a “manufactured home”. There are major differences in the home categories:

• Mobile homes are factory-built homes made before June 15, 1976. Since they were built before safety regulations were put in place by HUD, they aren’t usually approved for loans.
• Manufactured homes are factory-built homes that are built on a chassis. These homes are subject to the National Manufactured Housing Construction and Safety Standards Act of 1974 – they are required to meet safety standards set by the U.S. Department of Housing and Urban Development (HUD)that were put in place after June 15, 1976.

• Modular homes are similar to Manufactured homes but built to a different code (not HUD). They are never put on a chassis, are factory-built homes that are assembled on-site, and are typically permanently installed on a concrete foundation. They are basically a dwelling that is built in a factory, then joined together at the site on a permanent foundation in accordance with all state and local laws.
  • • Built to IRC code
  • Built in sections and put together at property site
  • Tend to hold value and appreciate more than manufactured or mobile homes, so it’s easier to get loans for modular homes

A common misconception is that manufactured homes are in certain communities. Most buyers go out and buy land and place the home on that land. This makes Manufactured Homes a quite affordable option. Products like Fannie Mae Home Ready and Freddie Mac’s Home Possible have more flexible guidelines and reduced MI.

Very nice areas have manufactured homes – they are not always trailers.

What is Considered a Qualified Manufactured Home?

There are certain qualifications involved with the Delaware Manufactured Home Loan:

• • One Unit Only

• • Must be constructed after 6/15/76 (when HUD guidelines came in place for constructions of manufactured homes)

• • Must have been attached to a permanent foundation in accordance with manufacturer’s requirements and Wheels & Tongue must be removed.
    

• • Must be in compliance with state, local, and federal codes

• • Must be permanently connected to utilities, a septic tank or sewer system
  • Trucked in Water or Cistern Water is not acceptable
  • Must be classified as Real Estate prior to the closing (Retired Title at Motor Vehicle)
    

What mortgage loan options are available to purchase a Delaware Manufacture home or a Delaware Mobile Home?

• Delaware FHA Loan
• Delaware VA Loan
• Delaware Conventional Loan 
• Delaware USDA Rural Housing Loan
• Mobile Home Loan for Leased Land

Delaware Manufactured Home Loans can be used with several government-backed loan programs, such as FHA, USDA and VA.  Below is a matrix showing the maximum loan to value (LTV) for each loan type when apply for a Manufactured Home Loan.

Below are the Guidelines for Manufactured Homes by Agency Guidelines per Loan Type:

What are the Legal Requirements for Delaware Manufactured Home Loans?

Your Manufactured home must have the HUD label and data plate evidence that proves the manufactured home was built to HUD code after the 1976 date.  An appraisers will always take a picture of the HUD label and the data plate to include in the Appraisal Report.

HUD Tag – The HUD Certification Label is a metal plate that is affixed to the exterior of each transportable section of the Manufactured Home.  The HUD Certification Number appears on each HUD Certification Label and evidences compliance with the Federal Manufactured Home Construction and Safety Standards.

The HUD Tag label is a metal plate affixed to the exterior of the home and the HUD Data Plate is a paper label that is mounted inside the home that includes info such as:

• • Manufacturer’s Name

• • Year the Manufactured home was manufactured

• • Serial Number and Model

• • Wind and roof load zones
  • Heating and Cooling Data
  • HU Construction Zone

This ensures the home has the right specifications for the region.

HUD Data Plate – The HUD Data Plate / Compliance Certificate is a paper label mounted in the Manufactured Home that contains, among other things, the manufacture’s name, trade/model name, year manufactured and serial number, a list of the certification Label number(s), etc.  The Data Plate is typically affixed in a readily accessible and visible location such as near the electrical panel or in a kitchen cabinet, or a bedroom.

Per 1976 HUD regulation, the HUD Data Plate form is to be affixed inside the home on or near the main electrical breaker box or other readily visible/accessible location and is printed on paper or foil stock 8 1/2″ x 11″ to 8 1/2″ x 14″ in size.  Some manufactures will also use this form for modular homes.

A very important requirement to note: since manufactured homes are built on a chassis, manufactured homes are considered vehicles until closing. The manufactured home must be legally classified as real property and titled as such prior to the closing of the Delaware Manufactured Home loan.

The title will be reviewed to ensure it has been De-Titled:

• • Vehicle title has been cancelled and is classified as a real property this is commonly called “DE-TITLING”
    

• • Title must clearly show that the home is an improvement to the land and will be treated as real property under applicable state laws
  • ALTA Endorsements 7, 7.1, or 7.2 or other endorsement is in place allowing home to be treated as a real property

What if There are No HUD Data Plates and/or HUD Tags?

If the HUD Data Plate and/or HUD Tags have been removed from the Manufactured Home and they cannot be found then the Lender will be required to order a IBTS Report at the buyer’s expense.

The Following will require a Lender to Order a IBTS Report:

• If the Appraisal report is showing either or both HUD Data Plate and HUD Tag have been removed from the dwelling.
• If the HUD Tag and/or HUD Data Plate has been painted over or are illegible.
• HUD Tag and /or HUD Data Plate has been covered up and appraiser is unable to obtain a legible photo of them.

Below are Samples of what an IBTS Report Looks Like:

What is an Engineer’s Foundation Certification?

When financing a manufactured home a Engineer’s Foundation Certification is required that certifies the foundation meets certain criteria of structure stability.  The Engineer’s certification specifies that the foundation complies with the HUD Permanent Foundation Guide for Manufactured Homes (PFGMH – HUD 7584), a requirement for all FHA-insured loans.

What Isn’t Allowed With Delaware Manufactured Home Loans?

Certain criteria will render a Manufactured Home ineligible for Real Estate financing:

• • Single wide homes are ineligible for most programs
    

• • No investment properties

• • No Lease Hold (Will Need a Chattel Loan)
    

• • Renovation Lending is allowed with FHA manufactured homes only

• • Second homes are available with Fannie Mae or Freddie Mac only

• • Is not eligible if it’s a property that was moved from it’s original site (was permanently affixed to a foundation and then moved to a new location – it’s fine if it is coming from a dealer)

• • No co-ops
  • Cannot have Wheels or Tongue still affixed to the Manufactured  Home.
  • No cistern or trucked in water

Can I use a Down Payment Assistance Program to Purchase a Manufactured Home?

Yes, you can use a Down Payment Assistance Program to purchase a Manufactured Home.  The guidelines are more restrictive in some cases.  Below are options for DPAs:

Delaware State Housing Authority (DSHA) Down Payment Program requires a minimum of 660 middle credit score for all borrowers and must be a double wide

PRMI Advantage DPA Grant Program – requires a 620 minimum credit score to get a 3.5% grant toward down payment.

Delaware Manufactured Home Lender

Primary Residential Mortgage is the leading Delaware Manufactured Home Lender providing mortgage loans for the purchase or refinance of a manufactured home.  The John Thomas Team of PRMI is well trained on the options available through FHA, VA, USDA and Fannie Mae to provide mortgage options for manufactured homes.  If you are looking for a Manufactured home lender in Delaware then give Primary Residential Mortgage a call at 302-703-0727 today!

How do I Get Started With the Delaware Manufactured Home Loan?

There is a lot of information to sift through for Delaware Manufactured Home Loans. The John Thomas Team can help you cover all your basis and land the home of your dreams – give us a call at 302.703.0727 or APPLY ONLINE.