Can You Use a VA Loan for a Manufactured Home?

The Department of Veterans Affairs (VA) home loan program stands as a significant benefit for eligible service members, veterans, and surviving spouses, designed to facilitate homeownership. This program offers various advantages, including competitive interest rates and, for many, the absence of a down payment requirement. A common inquiry among those exploring their home financing options through the VA program is whether these loans can be applied to manufactured homes. The answer is yes, VA loans can be utilized for the purchase of manufactured homes, though specific conditions and requirements apply to ensure the property meets established standards.

VA Loan Eligibility for Manufactured Homes

Using a VA loan for a manufactured home involves specific considerations that differentiate it from financing a traditional stick-built residence. A fundamental principle is that the manufactured home must be legally considered “real property” rather than “personal property”. This distinction is significant because real property is permanently affixed to land, unlike personal property which is movable and depreciates. To qualify, the manufactured home must be permanently attached to a foundation, and the land must be owned by the borrower.

General VA loan borrower eligibility requirements also apply to manufactured home financing. These include meeting specific service duration criteria and obtaining a Certificate of Eligibility (COE) from the VA, which confirms the borrower’s entitlement. While the VA itself does not impose a minimum credit score, individual lenders often set their own credit score thresholds, typically around 620 or higher, and may have stricter requirements for manufactured home loans due to their unique nature. Manufactured homes constructed before June 15, 1976, are generally not eligible for VA financing, as this date marks the implementation of federal building and safety standards by the U.S. Department of Housing and Urban Development (HUD).

Specific Requirements for Manufactured Homes

For a manufactured home to qualify for VA loan financing, it must adhere to precise physical and legal criteria. The home must be securely affixed to a permanent foundation that meets VA and HUD-approved structural engineering requirements. This foundation ensures the home is permanently anchored, and an engineer’s certification may be required to confirm compliance. The land must be owned by the veteran or purchased simultaneously with the home, as VA loans typically do not finance manufactured homes on leased land.

The home must also comply with all HUD manufactured home safety and construction standards, evidenced by a “HUD tag” (a metal identification plate on the exterior) and a “data plate” (a sticker inside the home with specifications). Furthermore, the manufactured home must be legally converted from personal property to real property, a process often referred to as “de-titling”. This typically involves surrendering the manufactured home’s original title, often held by the Department of Motor Vehicles, and recording an “affidavit of affixture” that legally merges the home with the land deed.

Manufactured homes financed with a VA loan must also meet the VA’s Minimum Property Requirements (MPRs), ensuring they are safe, structurally sound, and sanitary. These requirements cover aspects like proper heating, safe electrical systems, and adequate water and waste disposal. While the VA does not have a strict age limit, many lenders have their own policies, often preferring not to finance manufactured homes older than 15 to 20 years due to potential condition and appraisal challenges. Minimum square footage requirements also apply, with single-wide homes typically needing at least 400 square feet and multi-section (double-wide or larger) homes requiring a minimum of 700 square feet.

The Application and Approval Process

Securing a VA loan for a manufactured home involves a structured application and approval process, assuming the property meets the specific requirements. Finding a lender experienced in VA manufactured home loans is important, as not all VA-approved lenders offer this specific type of financing.

Upon selecting a lender, the loan application submission will require various financial documents, including income verification, asset statements, and credit history details. Lenders will review the borrower’s debt-to-income (DTI) ratio, which reflects the portion of gross monthly income allocated to debt payments, generally preferring it to be no more than 41%. A crucial part of the process is the VA appraisal, conducted by a VA-assigned independent appraiser. This appraisal determines the fair market value of the property and verifies that the manufactured home meets the VA’s Minimum Property Requirements and all HUD standards, including the permanent foundation and proper titling.

If the appraisal identifies any necessary repairs or non-compliance issues, these must typically be addressed before the loan can proceed to closing. Following the appraisal, the loan moves into the underwriting phase, where the lender conducts a thorough review of all documentation, including the borrower’s financial profile and the property’s compliance. The final stage is closing, where all legal documents are signed, and the loan is funded, transferring ownership of the manufactured home and land to the veteran.

Unique Aspects of Manufactured Home VA Loans

VA loans for manufactured homes present several distinct characteristics compared to traditional mortgages. While VA loans typically offer 100% financing for conventional homes, some lenders may require a down payment for manufactured homes, often around 5% of the purchase price. The loan limits for manufactured homes are generally subject to the same county-specific limits as traditional VA loans, and the financing can cover both the manufactured home and the land it occupies.

Loan terms for manufactured homes financed with a VA loan are often shorter than those for site-built homes. For instance, a loan for a double-wide manufactured home with land might have a maximum term of 25 years and 32 days, while a single-wide home, with or without land, could have a maximum term of 20 years and 32 days. This shorter term can result in higher monthly payments compared to a longer-term loan for the same amount. Lenders may also show a preference for multi-section manufactured homes (like double-wides) over single-wide units, as they are often perceived as more stable and comparable to traditional homes.

Refinancing options, such as the VA Streamline Refinance (Interest Rate Reduction Refinance Loan or IRRRL) or cash-out refinances, are available for manufactured homes already financed with a VA loan. These options can help veterans lower their interest rates or access equity from their property.