Profile picture for best10151

Y r banks so prejudice about loaning money for a modular home

  • August 12 2014 - Canton
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Answers (5)

Profile picture for rfcollett
Canton
Modular Homes in Ohio (mobile homes) are considered Personal Property rather than Real Estate. From the point of view of a lender, it is more similar to loaning on an automobile than it is to loaning  on real estate.

Good luck.
  • August 17 2014
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Profile picture for Blue Nile
It is not just the depreciation issue; it is how easy it is to move it off the lot and take it elsewhere if the borrower should decide they have no intention of paying the loan back.

Yes, any house can be moved by a professional house mover.  But one that came in 12 ft wide sections, and not bolted down, and has a steel frame to lift it by already makes it an extremely easy target for relocation.  Empty lots aren't worth nearly as much with no usable structures on them.

Most lender underwriters just need to verify the wheels have been removed and that it was bolted to a foundation.

Now, if it is just in a mobile home trailer park?  That is a different issue as one does not own any land, and it is extremely difficult to sell a mobile unit that doesn't have a place to put it.  It pretty much ends up just being "junk".  Instead of it being a lien on the land, it is essentially the same as a lien on a trailer licensed through the DMV.  Sure, it could essentially be "repossessed"; but what would anyone do with it?
  • August 12 2014
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Modular or Manufactured? there is a difference. A manufactured has a chastity and has had tires at some point to move it to the location, whereas, a modular is built in a factory and is brought in on a flat bed and put together on site. Banks look at both of them very differently and if I had my choice I would rather have a modular because they are built better and not as weathered as a site built home. Best of luck..
  • August 12 2014
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Actually modular homes are treated more and more like 'stick built' properties. If you need help or have questions, let me know. I'd be happy to help. Best wishes otherwise, Kimberly Lawson, Licensed Mortgage Loan Originator - Ohio only. Contact and licensing information can be found on my profile.
  • August 12 2014
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Profile picture for wetdawgs
They are "prejudice" because modular homes tend to lose value very quickly. 
  • August 12 2014
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