8 Key Steps to Buy a Manufactured Home

In order to buy a manufactured home, you’ll need to do some research, take a good look at your finances, find a location, shop around to find the right home, and finance the purchase. The site will be prepared, if necessary, and you’ll wait for the home to be delivered, installed, and anchored, and finally you’ll be ready to move in.

In this article, we’ll give you the guidance you need to get started on your manufactured home buying journey.

Put aside any ideas you might have about “mobile homes,” from their appearance to their quality and desirability. Today’s manufactured homes have a lot more to offer their owners than the trailers of yesteryear. Built to high standards of quality and safety, they can be customized in any number of ways, from size to layout to finishes.

“Manufactured homes can often cost less than renting while providing superior finish-outs to a comparably priced single-family stick-built home,” explains Bill Packer, EVP and COO of American Financial Resources, Inc., “all while providing more square footage, all new appliances and other premium features, and even some welcome distance from your neighbors versus apartment or condo living.”

It’s no wonder that manufactured home sales have increased over the last decade.

Here are 8 key steps to help you buy your manufactured home the right way.

1. Do your research

The internet is the first stop when you’re looking for a manufactured home. It’s the best place to get a sense of the types of home available to you.

Start by searching for manufacturers and dealerships located near you—delivering these homes is a time-consuming and expensive process, despite the fact that they’re often referred to as “mobile homes.” In general, most sellers will deliver within a limited geographical area.

Once you find a list of brands in your area, take a look at their websites to learn more about the lines they offer and the services they provide.

One thing you’re unlikely to find during your web search is clear pricing information. Sellers tend to keep this information to themselves, which gives them an advantage over buyers in the sales process.

Luckily, you don’t have to go into these situations blind. One source for basic pricing information is the Manufactured Housing Survey (MHS), which is sponsored by the Department of Housing and Urban Development (HUD) and whose data is collected by the U.S. Census Bureau. This survey offers monthly statistics on new manufactured housing, such as average prices and how many units are shipping.

Here are the average prices for single-width and double-width (or more) homes by region for January through August, 2020, the latest numbers available at publication:

Average Price of New Manufactured Homes by Size and Region, Jan-Aug 2020

 

Factors that affect the price include the size, brand, location, add-ons, and finishes.

Another way to get ideas about mobile home pricing, manufacturer reputations, and target markets—if you’re willing to spend a little money—is through the Grissim Guides, produced by journalist John Grissim.

The Grissim Ratings Guide to Manufactured Homes takes a comprehensive look at the manufacturers in the United States, rates their construction, provides price ranges, and gives history and background on the manufacturers.

According to the guide, you can get a budget home—a basic roof-and-walls single—for as low as $20,000. Some manufacturers specialize in these basic models for people who prioritize price.

On the other end are stylish, high-quality homes that are built almost to the level of a site-built home. They can go from about $85,000 for a single to $200,000 and up for a triple or more.

A lower-end double will cost you around $80,000 and a higher-end one will cost about $150,000.

The Grissim guide can help you shorten your list of places to shop. If you’re looking for a budget unit, for example, you can avoid brands that focus exclusively on luxury buyers.

2. Assess your finances

Once you have a ballpark idea of manufactured home pricing, you’ll need to do a reality check on your own finances. Take a look at your income (current and expected, especially if you’re planning to retire), as well as your weekly, monthly, and annual expenses.

Evaluate how much money you have in accessible accounts, such as savings accounts or money market accounts, and make sure you’re comfortable with the state of your investment and retirement accounts.

If you’re planning to sell your home, look at sales of comparable homes in your area to get an idea of how much you’ll make on the sale—and then subtract the amount you owe on any remaining home loan.

If you’re going to finance your purchase, get a copy of your credit report from AnnualCreditReport.com.

Regardless of how you intend to pay for your home, gather copies of relevant financial documents (account statements and W-2s, for example). You will need them later and you’ll be glad to have them in one place.

3. Look at locations

When you are getting ready to buy a manufactured home, one of the first things to consider is the location. Why is location so important? Because it can limit the options you have regarding your manufactured home.

Here are a few possibilities for locating your manufactured home:

1. a) You already own land.
3. You’re off to a great start. Now you need to find out what type of home you can build. Some areas don’t allow manufactured housing at all, and others have restrictions—for example, you may be able to have a double-wide home that resembles a stick-built house, while a single-wide home is prohibited.
5. If you’re not sure where to start, try your local zoning office or any neighborhood association or planned community. If you still can’t find the information you need, you can work with a real estate lawyer to make sure you’re not in violation.
6. b) You plan to buy property.
8. If you want to buy property separately from the home, you’ll need to target your search to areas that allow manufactured homes of the type you plan to buy.
10. “The thought of buying a piece of land and putting a mobile home on it seems like an easy and quick option,” says Robyn Flint, an insurance specialist with USInsuranceAgents.com and a licensed realtor in Virginia. “However, buying land to improve may come with restrictions for manufactured homes. Before buying a manufactured home, buyers need to do some research to protect their investment.”
12. Look for a buyer’s agent who has experience helping clients buy land for various uses, if not specifically for manufactured homes.
14. This is also a good time to talk to lenders; you may be able to get funding that wraps the home and land into a single loan and monthly payment.

1. c) You plan to lease a lot.
3. There are many manufactured housing communities—still sometimes referred to as mobile home parks—throughout the country, and they range from bare-bones lots with hookups to resort-like communities with amenities such as pools and clubhouses.
5. When you find a few possible communities, set up tours with management. You’ll see the available lots and facilities and get a sense for the atmosphere.
7. While many communities are available to the general public, others are aimed at specific populations—most notably retirees or those 55 and up.
9. While you’re touring, you may find that the management organization also serves as a dealer, with new or pre-owned homes for sale as well as lots to lease. The benefit here is that you can tour the exact home before you purchase it, rather than waiting to see it when it comes new from the manufacturer.
11. When you find a community and/or lot that suits you, ask about any restrictions on the homes there. If it’s an empty lot, what type of home can you have brought in? If the home already exists, what sort of modifications are allowed?

4. Go shopping to find the home you want

Manufactured homes have a few things in common. They are space-efficient, since they have to be moved from the factory to their ultimate location via roads and highways, either as one piece or in multiple parts. They include some sort of sleeping, cooking, and bathroom facilities. And they are simple in shape—limited, again, by the way they are assembled and moved.

Another critical factor is that all manufactured homes, by law, must conform to HUD code. This requirement means that even low-end models meet standards for safety and quality.

But given their basic common traits, manufactured homes can vary widely. They differ by manufacturer, age, layout, and appearance. The look of your home comes down to your personal tastes and budget, but there are a few decisions you’ll need to make first.

1. a) Used or new?
3. A shiny new home is appealing, but you will save money if you buy a preowned home.
5. There may be downsides to purchasing an existing home, though. Some parks or communities will not allow you to bring in an older existing home, and used homes can also be harder to finance.
7. Homes built before June 15, 1976—when the HUD code was established—were not held to the same safety and quality criteria as homes built later.
9. That said, a properly built previously owned manufactured home can be a great deal.
11. “A couple years ago I was at a park in Palm Beach,” says Chris Michaels, founder of FrugalReality.com. “The used home was a 3-bedroom, 2-bath, new carpet, freshly painted walls, [up]dated appliances, stamped driveway with a carport, and air conditioning for a resale price of just under $30,000. The park was nice with a big clubhouse and amenities. Who would think you can own a home in that area for $30k!”
13. b) Where will you buy?
15. If you’re buying a used home, you can work with the seller or a real estate agent, just as you would a stick-built home.
17. If you want to buy new, you’ll first need to narrow down your options. In the United States alone there are about 60 home manufacturers. Manufacturers can differ in available models, warranty length, and customer service.
19. If you’ve found a manufacturer or a line of homes you like near you, find out where you can tour sample units and order your own. Dealerships are a common place to buy new homes, but you can also purchase through a manufactured home community.

2. c) Single, double, or more?
4. Sometimes called “single-wide,” a single manufactured home is built and transported as one unit. While these homes are the smallest and least expensive, it’s important to know that they often come with more restrictions.
6. Due to assumptions about the value of the property or the financial responsibility of the owner—fair or not—it can be much harder to get a loan for a single, and they are restricted in more locations.
8. Double units are shipped in two halves, and as a result they have a more traditional length-to-width ratio than singles. They can have an appearance more like a stick-built home, and they offer more layout possibilities.
10. On average, according to the Manufactured Housing Survey, double units cost about 1.9 times the price of single units—they are twice the size, but since single units contain kitchens and bathrooms (the more expensive parts of the home) you can get the extra space for a little under double the price.
12. It’s even possible to find homes with more than three sections, although the boundary between manufactured homes and modular homes can get thin in that area.
14. d) Customize.
16. When you buy a new manufactured home, you’ll have plenty of options. You can choose the model you want, the layout of the rooms, and finishes such as flooring and lighting. This is your chance to make it your own—but you’ll pay for everything you add.

5. Figure out your financing

According to the latest data from the Manufactured Housing Survey, published by the U.S. Census Bureau, the average price of all manufactured homes sold today is $85,438. Compared to $310,800—the median price paid for all existing homes in the U.S., according to the National Association of Realtors—manufactured homes are a bargain.

Still, a manufactured home is one of the biggest purchases you will make. There are several approaches to paying for your home.

1. a) Cash.
3. Cash may be a realistic option for homeowners who are downsizing. The benefit of cash, of course, is that you won’t pay any interest on your home purchase.
5. b) Chattel loan.
7. Manufactured homes are usually titled as personal property. Like a car, boat, or plane, they have an identifying plate. They are often financed through chattel loans, which tend to have higher interest rates than mortgages, but lower upfront fees. Typical terms are 10, 15, or 20 years.
9. You can find your own lender or work with the dealer. As with car dealerships, manufactured home dealerships typically have relationships with private lenders and can work with you to obtain financing from them.
11. c) Mortgage.
13. A conventional mortgage can be hard to get for a manufactured home. “There are strict lending guidelines,” says Flint. “For example, some government loan packages will only fund manufactured homes built after 2006 [that] have a permanent foundation.
15. ”For your home to qualify, you may need to own the land. Mortgages are sometimes available for manufactured homes that are titled as real property along with the land.
17. Two conventional mortgage products that may be used to buy a manufactured home are Fannie Mae’s MH Advantage and Freddie Mac’s ChoiceHome. These loans have low requirements for down payments—as low as 3%.
19. Some buyers qualify for government-backed mortgages with the Federal Housing Authority, USDA, or VA.
21. FHA Title I loans are particularly flexible; they can be used toward the home itself, the lot, or both—and that means you can get a loan without owning the land.

6. Wait

A ready-to-go home can be yours quickly. If you have selected a site and hook-ups are ready, you’ll just need to get on the delivery and installation schedule.

For new homes, construction time can vary. Clayton Homes, one of the country’s largest manufacturers, has factories that can build a standard home in as little as two days, but the wait time will depend on how many backorders the manufacturer has. Customizations take longer.

In general, for a custom-built home, expect two to four months from order to delivery.

Meanwhile, the site must be prepared. You’ll need a foundation—temporary or permanent—and hookups for electricity, sewer, and water.

7. Have it shipped and installed

The parts of your home will be built on a chassis with wheels, and when delivery time comes they will be towed like trailers, complete with the “wide load” signs and pilot vehicles you’ve seen while driving down the highway.

Once the home or its parts arrive, the wheels and axles will be removed. (While the term “mobile home” is often still used interchangeably with “manufactured home,” today’s homes are not actually mobile.)

The parts of the home will be attached onsite, anchored, and hooked up to the utilities. Finally, any extras will be added, such as stairs, skirting, porches, or other external features.

8. Move in

Now the home is your own, and it’s time to bring in all your belongings. You can do this yourself, bring along a few friends, or even hire a moving company to handle all of the furniture and boxes so you don’t have to do it yourself.

Get to know your new neighbors and your community. And don’t forget to take some time to relax and enjoy your new space. It’s been a long journey to get here—for the house and for you, too!

While buying a manufactured home can be intimidating, the steps we’ve provided will help you know what to expect. The best way to get comfortable with the process is to go out, tour some homes, and have conversations with the sellers.

Once you know what’s available in your price range, and what you like and dislike, you’ll be well prepared to make decisions about your new home.

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