September 20, 2017
Can I buy a manufactured home with an FHA loan? That is a question on the minds of many who are interested in purchasing a mobile home or manufactured home. What are the FHA loan rules for these properties?
For starters, It IS possible to buy a mobile home or manufactured home using an FHA mortgage. Not all participating FHA lenders offer these loans (that’s up to the discretion of the lender) so you will need to find a lender who offers this type of FHA mortgage.
Secondly, the homes themselves must meet FHA loan standards and other requirements in order to qualify for the mortgage.
What are the FHA loan rules for mobile and manufactured home loans?
One of the most basic areas addressed in the FHA loan handbook for these types of mortgages? The foundation. Mobile/manufactured homes do not start off on a permanent foundation, but they must wind up on one as a condition of loan approval.
That is one reason why you can’t get an FHA mortgage for a house boat or an RV; there is no permanent foundation available for these, therefore they cannot be purchased with an FHA loan.
The specific requirements for mobile homes and manufactured homes is as follows, as printed in HUD 4000.1, page 151. The property must:
-be designed as a one-family dwelling;
-have a floor area of not less than 400 square feet;
-have the HUD Certification Label affixed or have obtained a letter of label verification issued on behalf of HUD, evidencing the house was constructed on or after June 15, 1976, in compliance with the Federal Manufactured Home Construction and Safety Standards;
-be classified as real estate (but need not be treated as real estate for purposes of state taxation);
-be built and remain on a permanent chassis;
-be designed to be used as a dwelling with a permanent foundation built in accordance with the Permanent Foundations Guide for
Manufactured Housing (PFGMH); and
-have been directly transported from the manufacturer or the dealership to the site.
These requirements are non-negotiable, and HUD 4000.1 has no exceptions to the above policy listed. There may also be state or local requirements which must be satisfied in addition to FHA loan requirements, so it’s important to discuss the purchase with a loan officer to see what additional considerations may apply.
Mobile and manufactured housing is required to have an appraisal in the same fashion that other homes to be purchased with FHA loans must get one.
Borrowers should also consider the optional but very important home inspection for any FHA loan purchase as the appraisal is not intended for the borrower’s protection but rather for the lender. You can’t make a fully informed home purchase without the home inspection.
Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for www.valoans.com for (8) years and is currently the Associate Editor for FHANewsblog.com.
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