What Are Manufactured Homes?

Manufactured vs Mobile vs Modular

They are all considered prefabricated (prefab) homes. Off-site homes built inside building facility then transported to home site for final assembly.
Mobile homes and MH used interchangeably, but difference was established in 1974 through National Mobile Home Construction and Safety Act followed by 1976 HUD Manufactured Home Construction and Safety Standards (usually called HUD code) which set federal standards in areas such as:
- Design/construction
- Body/frame requirements
- Thermal protection
- Plumbing/electrical
- Fire safety
- Energy efficiency

Prior to 1976

Prior to 1976 mobile homes were mass produced due to the demand for affordable, moveable housing, but there was very little oversight when it came to building specifications. Starting in the early 1900s, people found they needed to be able to move to wherever jobs were available in order to provide for their families, and so the mobile home was born.

Post 1976

Sources:

Stages & Sizes

MH Homes come usually in 3 stages and the difference is the number of sections they come in:
- Single wide
- Double wide
- Triple wide
MH can be identified by their size, or you can double check by going to the west side of the home to look for MH tags. If you see only 1 tag, it means it is single wide, if you see 2 tags, it is double wide, and 3 tags means triple wide.

Almost all the manufactured homes are in post and block foundations.
Manufactured homes are designed to be affordable, so people don’t spend a lot of money to buy good quality materials, hence:
Most older manufactured homes typically have regular vinyl siding, vinyl-on-gypsum wall panel, torch down roof, laminate flooring and or carpet.
New ones tend to have better quality materials, such as composite asphalt roof, cement plank or engineered composite wood siding, drywall, vinyl flooring and or carpet with better padding.

Source: https://www.claytonhomes.com/studio/building-on-strong-manufactured-home-foundations/

Private Owned Land

Land-Owned Community

Manufactured homes reside in a MH community where you own the land. Small payment to HOA which then provides services such as ensuring utilities are working, common area maintenance, repairs, etc. Utilities are oftentimes included

Land-Lease Community

Manufactured homes reside in a MH community where you lease the land on the MH sits on and pay “lot rent”.
Rent prices can vary but are generally in the range of $400 – $900.
Oftentimes, utilities are included in the rent.

Source: https://www.mhomebuyers.com/manufactured-home-communities/

MH will oftentimes have titles (state issued conveying ownership of personal property), just like vehicles do.
In order to eliminate title, one of the criteria is that the MH must be properly secured on a permanent foundation. A licensed structural engineer will then come out to inspect said foundation.
- Source: https://themortgagereports.com/72312/converting-a-manufactured-home-
After approval from inspector and fulfillment of the other requirements under RCW 65.20.040, application is made to DOL
- Source: https://app.leg.wa.gov/rcw/default.aspx?cite=65.20.040
- Source: https://apps.leg.wa.gov/wac/default.aspx?cite=308-56a-505
Eliminated title helps open financing options and is oftentimes actually required by a lot of MH lenders. It is also now viewed as a stick built (or site built) home instead of MH, removes the personal property status for titling and tax collection purposes.

2 common MH loans are the Chattel Loan and Portfolio Loan

Chattel Loan

Portfolio Loan

Loans that are kept “in-house” and not sold to secondary market
Be mindful that that type of MH (single-wide, double-wide, triple-wide), if it’s been moved more than once, whether title is eliminated or not, etc. Will affect which lenders are able to give the loan.
If built POST June 15, 1976, there are many lending options available.
- Nexa Mortage has multiple lending options for MH post June 15, 1976
  - Minimum credit – 600
  - Minimum 5% down – primary
  - Minimum 20% down – secondary
  - Rate determined by credit score / down payment. Typically higher as it’s higher risk for the lender.
If built PRIOR to June 15, 1976, it does not meet HUD requirements and FHA will NOT insure mortgage. Most other mortgage insurance firms follow FHA’s policy, which makes it difficult to obtain a loan for MH built prior to 1976.
- Frank Bonner at Banner Bank can do loans for pre-1976 MH in parks where you own the land, but must have 20% + down.
- It will have higher interest and he has to confirm permits for any additions and original permit for when house was placed.
- He can do lower than 20%, but PMI “can get a little hairy”.
- Sound Credit Union can pretty much do anything MH related
- https://www.soundcb.com/loans/home-loans/manufactured-home-loans.html

· Whether it’s in a leased park or owned land, it will affect financing ability as well.

Comp just like you would any other house with the exception of two things:

Must comp single-wide’s to other single-wide’s, double-wide’s to other double-wide’s, etc.
Try to keep separation between MH built prior to 1976 and those built post 1976. The ability to easily fiancé or not is very important to consider.
Be mindful if the MH has had title eliminated or not. This is a nice value add but more so than a monetary value, it helps speed up the process for financing.
Eliminating title while under mutual acceptance is also something that can be done, but you’d want to confirm beforehand that all the criteria for eliminating title can be met or ensure you have a financing contingency for the duration of the contract.