Did you know you can buy manufactured homes with USDA* loans?
That’s right – eligible homebuyers can purchase a manufactured home with a zero down USDA loan.
And that’s big news because manufactured homes can offer an affordable alternative to traditional houses, particularly in competitive markets.
Who is eligible for a zero down USDA loan?
To qualify for a 0% down USDA loan you’ll need to meet the following criteria:
- Meet the USDA income limits for your area
- 640 or higher credit score (though lenders can approve borrowers with lower scores, depending on other financial factors)
- Purchase an eligible property type, including manufactured homes, single-family homes, condos or townhouses
- Property must be your primary residence, not a vacation home or investment property
USDA property requirements for manufactured homes
You may qualify for a zero down USDA loan, but the home you want to purchase must meet the USDA manufactured home property guidelines as well. Here’s what to look for when scoping out homes:
- Property must be in a USDA-eligible area
- Minimum 400 square feet of living space. However, lenders may have different requirements. Fairway requires that the home have at least 600 square feet of living space.
- Home must sit on a permanent foundation
- You must have a site for the home at the time of purchase
- Home must be new a unit (built within 12 months of your purchase agreement) that has not been lived in previously or installed at another site
- Home must sit on an approved state and local building site
- Home must meet or exceed the Federal Manufactured Home Construction and Safety Standards of the U.S. Department of Housing and Urban Development (HUD)
- Home must be zoned, taxed and recorded as real estate
Currently, the USDA manufactured home loan program is only available in select states, including:
- Pennsylvania
- South Dakota
- Tennessee
- Texas
- Utah
- Vermont
- Virginia
- Washington
- West Virginia
- Wisconsin
- Wyoming
- Colorado
- Iowa
- Louisiana
- Michigan
- Mississippi
- Montana
- Nevada
- New Hampshire
- New York
- North Dakota
- Ohio
- Oregon
Additionally, the USDA manufactured home loan program is set to expire on Nov. 4, 2024. The USDA could potentially extend the program at that time. But if you’re interested in buying manufactured homes with USDA loans, now is the time to connect with a lender and find out if you’re eligible.
Alternatives to USDA manufactured home loans
If you are not eligible for a USDA loan, or you live in a state where USDA manufactured home loans are not available, there are other loan programs that allow you to purchase a manufactured home:
If you’re eligible for a USDA loan but you decide not to buy a manufactured home, you might consider a USDA renovation loan. This zero down loan allows you to purchase and renovate a home with a single mortgage. That means one monthly payment for the home loan and renovation expenses.
Can you buy manufactured homes with USDA loans? FAQs
Can I use a USDA loan on a manufactured home?
Yes, you can, as long as you meet the USDA eligibility criteria and you purchase a qualifying home in a USDA-designated area.
Is it easier to get a loan for a manufactured home?
Not necessarily. You will need to ensure that your lender offers loans for manufactured homes, and the property will need to meet the guidelines for whichever loan program you choose. Manufactured homes must meet government building standards and you’ll need to show you have an approved site with a permanent foundation where the home will be installed.
What loans cover manufactured homes?
You can use Conventional, USDA, VA, and FHA loans to purchase a manufactured home.
The bottom line on buying a manufactured home with a USDA loan
USDA loans offer eligible homebuyers a great, affordable way to purchase a property. Whether you’re in the market for a manufactured home, a traditional house, or another type of home, it’s best to connect with a lender early on to learn about your loan options and which is best for your goals.
Let’s Start a Conversation!
If you’re interested in learning more about your options, connect with us today.
*USDA Guaranteed Rural Housing loans subject to USDA-specific requirements and applicable state income and property limits.
Copyright©2023 Fairway Independent Mortgage Corporation. NMLS#2289. 4750 S. Biltmore Lane, Madison, WI 53718, 1-866-912-4800. All rights reserved. This is not an offer to enter into an agreement. Not all customers will qualify. Information, rates, and programs are subject to change without prior notice. All products are subject to credit and property approval. Not all products are available in all states or for all dollar amounts. Other restrictions and limitations may apply. Fairway is not affiliated with any government agencies. Fairway is required to disclose the following license information. AZ License #BK-0904162; Licensed by the Department of Financial Protection and Innovation under the California Residential Mortgage Lending Act, License No 41DBO-78367. Licensed by the Department of Financial Protection and Innovation under the California Financing Law, NMLS #2289. Loans made or arranged pursuant to a California Residential Mortgage Lending Act License; Georgia Residential Mortgage Licensee #21158; For licensing information, go to www.nmlsconsumeraccess.org; MA Mortgage Broker and Lender License #MC2289; Licensed Nevada Mortgage Lender; Licensed by the NJ Department of Banking and Insurance; Licensed Mortgage Banker-NYS Department of Financial Services; Rhode Island Licensed Broker & Lender; Fairway Independent Mortgage Corporation NMLS ID #2289 (www.nmlsconsumeraccess.org). Equal Housing Opportunity.
