Depending on where you buy and the size of your mobile home, you may need to look into getting a mortgage to help you buy. Unfortunately, a major downside and something you absolutely need to know when hunting for a mobile home is that getting a mortgage can be tricky. You could also find yourself faced with a bad mortgage rate when trying to buy a mobile home.
This is because mobile homes fall under being personal property, which makes them much more difficult to get a good mortgage loan for. Personal property loans, also known as chattel loans, usually have worse conditions such as higher interest rates and shorter-term contracts, meaning you’ll have to renegotiate often. Plus, banks consider personal property loans riskier than giving a regular loan for a house. To avoid paying through the nose in interest, you could have to save up more money to put down upfront before committing to a mortgage that will make you worse off in the long run.
One caveat is that if your mobile home meets some very specific requirements, you might be able to get a traditional mortgage. For example, Fannie Mae’s MH Advantage program offers a 30-year mortgage, but only if it’s at least 600 square feet and you own the land it’s sitting on.