10 months ago
Justin Becker ·
Comments Off on The Process of Buying a Mobile Home
Once you have made it to the closing, you may think you are in the home stretch. Well, in many ways, you are. However, when purchasing any home, there is a long list of things that still need to happen, like choosing a real estate attorney or closing agent. Most people believe that because they are purchasing a mobile home, they do not need a real estate attorney, but you may want one regardless. Nevertheless, besides finding someone to represent your legal interests, there are a few more steps to the home closing process.
The Closing Process
Typically, the closing process begins when you sign on the dotted line of a purchase agreement. This simple step triggers the next phase of closing on a home, also known as being in escrow. Here, you and the seller usually have a few weeks to get everything squared away. When purchasing a mobile home, there is often a contingency list provided by a third-party inspector or appraisal company. During this four to six week period in escrow, the seller is permitted to take care of all the listed items and repairs, or the seller may choose to offer money to cover the cost. After the contingency list is approved by all parties involved, negotiations are normally finalized, and pertinent documents are signed if they have not been already.
Here, depending on the type of financing or loan you choose, you may have closing costs. Nevertheless, these closing costs tend to be minimal. For instance, you probably need a public notary ($10) and an inspector/appraisal company ($250-$400). The homebuyer will also likely have to pay for the title search ($75-$100). Other expected closing expenses include sale tax (6%), possible county tax, and fees associated with the title transfer ($90). Overall, the total closing cost for mobile or manufactured homes is generally less than $5,000 (if you do work with a real estate attorney, you can expect to pay anywhere from $150-$500 an hour for their services.). However, this is just a rough estimate; your real estate attorney or loan officer can supply you with the exact figures. That said, there are a few more steps that are vital to the closing process. So, let’s go over those additional steps below.
Homeowners and Title Insurance
Most lenders require you to obtain insurance and show proof of purchase at the closing. You will also need to buy title insurance. By choosing to finance your mobile home, insurance is a must, and homeowner’s insurance can easily cost you, on average, $1,100 annually. Ultimately, homeowner’s insurance pays for itself since it covers your belongings and often major home repairs. Likewise, you should purchase title insurance to ensure you are the sole owner of your new mobile home. On average, title insurance is priced at $1,000 and is a one-time fee. Note, the buyer is usually responsible for purchasing both policies. That said, you can easily save yourself a few dollars by obtaining both policies from the same insurance company.
Meet Loan Conditions
Along those same lines, your lender has more than likely given you other conditions that must be met before your loan can be funded. A prime example is required documentation, such as proof of insurance and income, as well as the appraisal figures. A clear title report is also required across the board. Other conditions may be loan or lender specific, so remember to ask your loan officer about what conditions are lender-required. In terms of fees and expenses, you may have to pay for copies of your pay stubs and other pertinent documents, but that is basically it. Most of the common conditions are likely paid for already, like the title search report and the appraisal.
Though often thought of as an entirely separate process itself, preparing to move is a part of the closing process. Therefore, once your closing date is set, you should start organizing your move. This could entail purchasing boxes ($60+) and other moving supplies or starting to call around for moving quotes from reputable companies in your area. Plus, if you have some downtime during the closing, it never hurts to start creating your checklist.
Reviewing the Closing Disclosures
Clearly, another vital step is reviewing all closing disclosures. Reviewing these important closing documents will ensure that everyone is clear on the overall costs. A standardized form is given, at closing, so that you and the seller can see all the itemized costs. You should receive your disclosures at least three days before closing from your lender, as it is required by law that they give you enough time to review it.
Your final walkthrough is crucial to closing, especially if the last time you saw the place was when you were looking at other mobile homes for sale. Usually, your walkthrough is scheduled either the same day as your closing or 24 hours before. This is just a formality, but it still gives you just enough time to double-check everything. Your agent is responsible for setting up the walkthrough. Note, you should also have a professional inspect any work done by the seller before your walkthrough.
Get Your Documentation Together
When your closing date is here, you should have all the necessary closing documentation. This means have your insurance policies handy and bring your photo ID, a cashier check, your checkbook, and a list of the previous addresses for the last ten years. The good news is your closing agent, or attorney will send you a checklist to ensure you have everything you need for the big day, so there is no need to panic.
The final step in the closing process is the actual transfer of the mobile home from the seller to the new owner. After all the particulars are taken care of, you may be inclined to grab your keys to your new home and start moving in. Well, before you get started, remember this final stage is a good time to ask any questions you may still have. Ultimately, the legal transfer should involve closing disclosures, your loan application, a mortgage or promissory note, collateral, a title document, and proof of ownership. Other documents you may see are affidavits/sworn statements, the initial escrow disclosure, and the transfer tax declaration.
Double-Check Your State Requirements
Lastly, you need to file a homestead declaration if your state does not automatically grant it. For more details regarding homestead, your closing agent or attorney is a great source of information. Nonetheless, if this is your first time dealing with a homestead declaration, that is okay. A homestead declaration registers your home as your primary residence and affords you certain federal protections—prevention of forced sale during bankruptcy, allows the surviving spouse to stay in the mobile home, and exempts you from or rather limits certain property taxes.
The truth is mobile home closing costs are minimal at best. In fact, there is more paperwork than anything else. With that said, you should keep the above-mentioned costs in mind, as there clearly are additional expenses that you are responsible for as the buyer. Thus, to address this issue of paying closing costs head-on, it is highly recommended that you set aside a few extra thousand dollars. Alternatively, you can obtain a rough estimate of those costs and factor them into your required loan amount. The latter is common practice and saves people from scrambling to come up with additional funds for closing costs.
1 year ago
Justin Becker ·
Comments Off on 5 Tips for Buying a Mobile Home
Buying a mobile home can be challenging if you don’t know the right questions to ask.
With all the stigma around manufactured homes, it can be confusing to cut through the misinformation and get to the facts about manufactured housing.
Purchasing a mobile home is a significant investment. Often mobile homes and modular homes are cheaper than site-built homes by almost 20-30 percent. The floor plan will always determine the final price of a home.
According to the U.S. Census Bureau, manufactured homes can cost an average of $62,600, compared with $272,200 for a single-family site-built home.
According to new Census figures, an estimated 17.7 million Americans live in mobile homes, which is about 5.6% of the American Population.
Tips for Buying a Mobile Home
Not only are manufactured homes cheaper to own than site-built homes, but they’re also cheaper to build and maintain.
For instance, you will spend a considerable amount of money on property taxes, insurance, repairs, and so on with a site-built home.
When buying a new manufactured home, many aspects of the build quality are similar to those of a traditional home, but you should check a few things out.
Whether you are an investor or an end–user, you want a safe, streamlined, win-win mobile home transaction, right?
With that said, in this article, we’ll share five secrets to buying a manufactured home:
● Establish Your Price Range
● Establish Your Financing Options
● Pick Your Prefered Location to Place the House
● Speak With the Park Manager and Park Residents
● Understand Your Local Market
Establish Your Price Range
Most likely at the top of your list is your budget range. How much are you looking to spend on buying a mobile home?
With that said, your number one priority should always be what you can afford when searching the housing market.
When thinking of manufactured homes, you should also consider where to place the house.
Do you fancy mobile home communities, or do you have a plan to buy land? Either way, the cost associated with both options should be a top concern.
For community parks, look for those that are within your pricing range. The same applies to buying land. In other words, be honest with yourself and do your research.
Average New Mobile Home Cost (Nationwide)
Pricing can vary widely for manufactured homes, with factors like floor plans and standard options greatly impacting the price point.
Here is a breakdown of pricing, according to CostHelper:
● Single-Wide: $51,371
● Double-Wide: $96,529
● Triple-Wide/Multi-Wide: $100,000-$250,000
Establish Your Financing Options
Mobile homes are considered personal property, and not real estate, since it is not attached to the land.
As much as they are inexpensive, compared to traditional homes, mobile homes are not entirely easy to acquire. For instance, forking out $100,000, and upwards, for a new manufactured home is not an easy task, right?
Establish the options you have for financing the home. Unlike a traditional home, which takes longer to build, a manufactured home will take a few days, to months, to manufacture and deliver to your location.
It is also crucial to get your financing early. Mobile homes have become a little easier to acquire within the last three years.
More and more financial institutions have loosened up their requirements to accommodate the Manufactured Home Community.
With that said, like anything else, sometimes getting the funding can be a lengthy process.
For example, some lenders take a minimum of 21 days from start to finish, and that’s if you have all the required documentation they need and all of the stars are aligned perfectly.
If you own the land, you are likely to attract more lenders when buying the home. Also, some lenders may also support your bid to buy both the home and the land.
Ways to Obtain Mobile Home Financing
Once you figure out what kind of mobile home you want, it is time to find out how to finance it.
It’s possible to get a loan from the same sources as traditional mortgages, such as a FHA or VA loan.
Such options tend to give you longer repayment terms. However, depending on your situation, you may opt for a nontraditional path, with a shorter monthly payment term. This could include chattel loans or personal loans.
Here are all of the various options available to finance a mobile home:
1. FHA Mortgage
2. VA Mortgage
3. Fannie Mae
4. Freddie Mac
5. Chattel Mortgage
6. Personal Mortgage
Pick Your Prefered Location to Place the House
The location of the house is as essential as buying the home itself. You want to live in a strategic area where you can get almost anything within walking distance.
For example, if you want to shop around, you will want to take a few minutes to get there, rather than taking the bus.
When you’re picking out a location where you’d like to purchase a manufactured home, use the “SSS Method” or Safety, Schools and Scenery.
Research the Safety of the area by checking the local city data websites. You will want to know your neighborhood.
With that said, one of the best ways to compare scenery is to go out and explore physically.
You will be able to get the feeling of the prospective areas you will live in with your family.
Speak With the Park Manager and Park Residents
The park manager will give you insights into the rules of the park; the Dos and Don’ts. Also, it is a brilliant idea to engage other park residents to get their perspective of life within the mobile home park.
Such is one among many questions you need to ask the residents:
Is the park pet-friendly? It is crucial to find mobile home parks that accept pets if you are a pet lover.
You will also want to know the lot rent of different parks so you are able to help compare and make the proper decision for you and your family.
Understand Your Local Market
Do you want a single-wide or double-wide manufactured home?
One thing we can all agree with is to avoid confusion and overspending when buying your home.
It is crucial to understand whether your area is a seller’s or buyer’s market regarding traditional real estate.
If your home market is experiencing a strong seller’s market, then this may spill over into local mobile homes as well. Such may cause the price and demand to rise.
With that said, you will need to act quickly to purchase a mobile home you desire.
If you want to buy a mobile home, the secret to a successful purchase is adequate research.
Identifying the house, where you will live, and the actual purchase is a lengthy process that requires your total attention.
Lastly, you want to avoid higher rates, right? Always compare the interest rates of different loan lenders. Often, your credit history will play a role in determining the higher interest rate.
2 years ago
Justin Becker ·
Comments Off on Why You Should Buy a Mobile Home: 7 Great Reasons
Finding your next house can be quite an overwhelming venture.
For first time mobile home owners, it can be challenging to pick the best choice of house arrangement from the range of options that are available.
Being that mobile homes are one of the most popular forms of housing, you will enjoy some benefits that you’re unlikely to get from buying a stick-built home.
For years, the manufactured home industry has undergone an overwhelming gradual change that has seen homebuyers enjoying the quality and luxurious homes.
For example, granite countertops offer an aesthetic appeal to your mobile home’s interior, and are available at an affordable price.
Today’s homes are customizable, so you can get the design layout of your taste.
Why You Should Buy a Mobile Home
Manufactured homes are regulated by HUD, the Housing and Urban Development division of the federal government.
Manufactured homes are prefabricated structures, built in a factory, on a permanently attached chassis, before being transported to the site.
You can buy your mobile home and place it in a mobile home park or buy your own land. Residential park homes are hugely popular right now.
Not only does a mobile home park offer comfortable and modern accommodations, it is also cost-effective, safe, and built as part of a welcoming community.
If the idea of living more affordably appeals to you, manufactured housing may prove to be a good option.
If you are thinking of buying a mobile home, here are seven great reasons why you need to strongly consider moving forward:
1. It’s Cost-Effective: It’s Better than Buying a Site-Built House or Renting an Apartment
2. Mobile Homes Offer You Flexibility
3. Mobile Homes on Land Appreciate Like Other Homes
4. Mobile Homes are Safe
5. Mobile Homes can be Financed
6. You’ll Get Your Home Faster
7. Mobile Homes are Low Maintenance
It’s Cost-Effective: It’s Better than Buying a Site-Built House or Renting an Apartment
With a mobile house, you save in multiple ways. The most obvious is the cost to manufacture the house.
Buying a site-built house can be challenging since it’s often highly priced, when compared to manufactured homes.
Although they are both built from the same material, manufactured homes can cost up to 30% less than a stick-built house.
Perhaps this is the most beautiful thing about manufactured homes.
Because they are mass–produced and built on assembly lines, manufactured homes cost less to make, thus less to buy.
For instance, as of September 2018, the median price of a house in the United States was $225,700.
Depending on where you live, the average price of a house can be lower or much higher.
Comparatively, the average cost of a manufactured house in 2018 was $87,100.
On average, a one-bedroom apartment can cost you around $1,000 monthly.
In contrast, you can buy a manufactured house with a payment of $450 per month and a lot rent of $350 per month, if you are renting the land.
Suppose you spend around $100 for maintenance. Still the overall cost will almost be the same as renting an apartment.
However, you’ll enjoy a bigger space, in a luxurious house, all while also having the option to resell and recoup some cash.
Mobile Homes Offers You Flexibility
One of the best things you can enjoy with manufactured homes is flexibility.
Especially since a mobile home is usually more affordable than a stick-built home and only semi-permanent.
If you own land, you can place a mobile house on it now, and remove it in the future.
What you need to know is that even though manufactured homes are not easily moved once set up, they are easier to carry than a stick-built home.
Once a stick-built home is constructed, it is more or less there permanently. With your home mobile, you can move freely without worrying about it.
Mobile Homes on Land Appreciate Like Other Homes
Undoubtedly when the land value increases, your home will likely gain some value too.
If you have your house on private land, you are likely to reap big.
Many people are caught up in the argument that this type of housing depreciates.
Well, you are right, but seeing it from another angle will give you a glimpse of what could go right if you invest in them.
Real estate does not always go up in value, as many people discovered a decade ago.
However, when houses are rising in value over time, manufactured homes, with their own lots, go up with them.
Mobile Homes are Safe
Manufactured homes are among the safest housing choices available today.
The Manufactured Housing Institute provides some solid information about manufactured house safety.
Manufactured homes are built to HUD codes, which came into effect in 1976.
The U.S. Congress passed the bill in a bid to improve the safety standards of mobile homes, which were then on high demand.
In fact, post-1976 manufactured homes have lower rates of fires than even site-built homes.
Also, they are built to withstand strong winds, unlike the homes built before 1976.
Manufactured homes perform as well as site-built homes during a storm.
For example, during the Derecho storm of 2020, 140mph straight-line winds pounded the Cedar Rapids, Iowa area for 45 minutes.
Manufactured homes in Hames communities sustained less damage than stick-built homes, apartments and commercial properties.
None of the Hames manufactured homes tipped over.
Mobile Homes can be Financed
Many people have been mistaken about manufactured homes financing.
While they are not categorized as real estate properties, that doesn’t mean you can’t get financing from financial institutions.
Per the norm, it all comes down to your credit score.
If you have a good credit history, you are likely to attract lenders and get your house financed.
For instance, through HUD programs, banks will loan up to $69,678 on a mobile home that is on a rented lot, and up to $92,904 on a house attached to a lot.
Here are financing options you can use:
- VA Loans
- Personal Loans
- FHA Loans
- Fannie Mae
- Freddie Mac
- Chattel Loans
Please remember to compare different financial institutions’ interest rate before buying your house.
You’ll Get Your House Faster
Another often-overlooked advantage of assembly line construction of your house is the speed at which your home will be made.
Manufactured housing has gone through several revolutions, and we are a far-cry from the “trailer home” of yesteryear.
Construction times for mobile homes vary, but they are always faster than a stick-built home.
Some more affordable variants of manufactured homes can be built in as little as a few hours, while others will take several days, such as finishing touches on drywall, interior arches, or double-insulated windows.
Typically, it takes about four months from house order to house move-in.
With that said, the actual construction time to build a manufactured house in the factory is just a few days.
Efficiency of construction is a big advantage of the factory building process. Therefore, one can get their house within months after order.
Mobile Homes are Low Maintenance
Think about how much work a traditional property demands of you!
Stick-built homes demand maintenance that is expensive, especially when compared to manufactured homes. You’ll part ways with a lot of money when it comes to maintenance.
In other words, maintaining this type of house is not the same as maintaining a stick-built home.
Modern manufactured homes benefit from convenient, intelligent construction.
This means it’s never likely you’ll need to repair anything at expensive rates.
Older individuals who move into park homes will also benefit from single-level living.
Still there is less to maintain and repair, therefore there is less hassle and money spent!
What You Need to Know About Mobile Homes
Information is important before buying any product or real estate property.
Before you rush and find that mobile house dealer, here are a few things you should know about manufactured homes.
Types of Mobile Homes
Manufactured homes come in a variety of different floor plans, and they are classified according to their size.
A single-wide mobile home is the most common classification, typically ranging from 600 square feet to 1,330 square feet.
The dimensions of a single is usually 14 to 18 feet wide and 66 to 80 feet long, and it will usually feature one to two bedrooms.
A double-wide is actually two single-wides joined together to create a larger house. Typically, double-wides are family homes, as they offer larger floor plans.
Delivery and Setup
Whether you’re installing a mobile house on a large rural lot you own, or on an undeveloped site in mobile home parks, there are things you must do to prepare the land.
Some communities will prepare the site for you, while others put you in charge of hiring folks to do the required site work.
How to Insure a Mobile House
Much like a typical house, you’ll need a manufactured home insurance policy to protect the house and its contents.
If you’re getting a loan, mobile house insurance will almost certainly be required by the lender.
Most communities require residents to carry insurance as well.
The good thing is that many insurance companies offer mobile house insurance, so you’ll be able to shop around for the best rates.
Mobile home ownership is a popular form of housing. If you are thinking of buying a mobile home, this could be one of the best decisions in your life. You’ll save money!
They are energy-efficient, affordable and offer flexibility. These features are what makes it an attractive form of housing for many home buyers.