FHA Loan Options: Condos and Mobile Homes
The FHA loans for mobile homes and manufactured homes are known as Title I loans and these mortgages can be used to buy or refinance a mobile home.
Title I loans can also be used to purchase a combination mobile home and lot. Mobile home loans are offered with fixed-rate mortgages and the official site for HUD states that most mobile home loans guaranteed by the FHA are for 20 years.
FHA loans for mobile homes do not require the borrower to own the land the home will be placed on--a leased lot is acceptable for FHA loan purposes. According to HUD, in such cases there is a requirement for the borrower to have a lease of at least three years for the lot. One important condition for borrowers who seek this type of arrangement?
The borrower must be provided with “advance written notice of at least 180 days, in the event the lease is to be terminated” according to HUD.gov.
FHA Condominium loans are offered with the same low down payment requirements as other FHA 203(b) loans, but like FHA Mobile Home loans there are some unique procedures. For FHA Condo loans the condo unit you want to buy must either be in an FHA-approved condo project, or the project must be added to the approved list.
There is also an option for FHA approval of the single condo unit in a project otherwise not approved by the agency.
In those situations, the HUD official site reminds, “To be eligible for Single-Unit Approval, the unit must be located in a project that is not FHA-approved, that is complete and ready for occupancy, has at least five dwelling units and it is not a manufactured home.”
The project must also “meet a subset of the requirements set forth for project approval, including FHA insurance concentration, owner-occupancy percentage” as well as its financial status.
Condo loans and mobile home loans may not be offered by all participating FHA lenders. Demand, market conditions, and inventory are just some of the factors that may result in a lender choosing not to offer one type of mortgage or refinance loan.
If you are in a housing market that only has one or two lenders offering the types of loan you seek, it may be harder to get a competitive loan option. It pays to shop around for a lender but in some cases, your choices may not be as plentiful. Some borrowers find that it pays to have more flexibility in their property choices depending on how many options are available in their area.
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