June 17, 2024
FHA announced changes to the FHA loan limit structure in early 2024. Those changes included updating FHA Title I manufactured loan limits which had not been changed in 15 years at press time.
The FHA Title I Manufactured Home Loan program offers higher loan limits now, part of an effort to provide more affordable housing.
“The increases better align with current market prices and are expected to encourage more lenders to offer the program to homebuyers seeking to purchase manufactured homes and the lots on which they sit” according to a press release at HUD.gov.
Making Manufactured Housing More Available
These changes are the first serious FHA manufactured home loan update since 2008. HUD Secretary Martha Fudge calls the move an option to alleviate an “affordable housing supply crisis” by encouraging more participating FHA lenders to offer Title I manufactured home loans.
Updated Manufactured Home FHA Loan Limits
The updated Title I Manufactured Home Loan Program loan limits include the following higher limits:
- Combination Loan for “single-section” homes: $148,909
- Combination Loan for “multi-section” homes: $237,096
- Manufactured Home Loan for single-section: $105,532
- Manufactured Home Loan for multi-section: $193,719
The FHA loan limit to buy a lot where the borrower can install a manufactured home on is $43,377. A HUD pledge to recalculate the program’s loan limits is meant to occur “on an annual basis so that they keep pace with home price changes over time.”
FHA Title I Manufactured Home Loan Terms
FHA Title I loans feature a six-month minimum loan term and there are maximum loan terms as follows:
- 20 years and 32 days for a loan on a manufactured home or on a single-section manufactured home and lot;
- 15 years and 32 days for a manufactured home lot loan;
- 25 years and 32 days for a loan on a multi-section manufactured home and lot.
What To Know About FHA Manufactured Home Loans
Did you know buying a manufactured or modular home with an FHA mortgage is possible without buying land? You can use an FHA loan to buy a developed lot to place the home but HUD adds that the property “must be used as the principal residence of the borrower.”
For those not interested in buying a plot of land with an FHA loan, leasing is an option with FHA Title I loans. HUD rules say Title I borrowers “may lease a lot, such as a site lot within a manufactured home community or mobile home park,” and the lease must have a starting term of three years.
FHA loan rules added to HUD 4000.1 note the conditions of the lease must include “advance written notice of at least 180 days, in the event the lease is to be terminated,” which is a consumer protection measure intended to add stability to an FHA loan in the early years of the mortgage.
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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