Do VA Loans Cover Mobile Homes? What You Need to Know

A Veterans Affairs (VA) loan offers a benefit for eligible service members, veterans, and surviving spouses to facilitate homeownership with favorable terms. Many ask if these loans cover mobile homes. While older “mobile homes” built before federal standards generally do not qualify, VA loans can indeed be used to finance specific types of manufactured homes, provided they meet stringent requirements. This distinction is crucial for understanding VA financing for factory-built housing.

Eligibility Criteria for Manufactured Homes

For a manufactured home to qualify for VA financing, it must adhere to specific federal construction and safety standards. The home must have been built on or after June 15, 1976, the effective date of the Housing and Urban Development (HUD) Code. This code ensures the home meets federal requirements for structural design, fire safety, energy efficiency, and durability, and the home must display the appropriate HUD certification label or tags.

Beyond the construction date and HUD compliance, the manufactured home’s legal classification is a significant factor. It must be permanently affixed to a foundation and legally classified as real property, rather than personal property like a vehicle. This typically involves a “title elimination” process, converting the home’s title from personal property to real estate. VA loans generally do not cover recreational vehicles or manufactured homes that remain on leased land or are not permanently affixed.

Manufactured homes also have minimum size requirements to be eligible for VA financing. Single-wide homes typically need at least 400 square feet. Double-wide or larger manufactured homes must generally have a minimum of 700 square feet.

Property Requirements for VA Loans

The land and its connection to the manufactured home are important for VA loan eligibility, ensuring the property functions as real estate. A manufactured home must be placed on a permanent foundation that complies with VA and local building codes. This foundation must be professionally engineered and capable of bearing the required load while withstanding environmental factors like strong winds.

The borrower must own the land on which the manufactured home is situated, or be in the process of purchasing it concurrently with the home. VA loans typically do not finance manufactured homes located in mobile home parks where the land is rented or leased. Additionally, the home must have all wheels, axles, and the towing hitch removed to signify its permanent installation.

Requirements also extend to permanent utility connections, including water, sewer, and electricity. The property must have direct access to a public street or a private road. These property standards help ensure the home is safe, structurally sound, and sanitary, meeting the VA’s Minimum Property Requirements (MPRs).

Securing a VA Loan for a Manufactured Home

Obtaining a VA loan for a manufactured home involves several procedural steps, assuming the home and property meet the aforementioned criteria. Not all VA-approved lenders offer financing for manufactured homes, so finding one with specific experience in this niche is an important first step. After identifying a suitable lender, borrowers typically undergo a pre-approval process, which helps determine their budget and loan terms.

The application process requires submitting necessary documentation, including a Certificate of Eligibility (COE) from the VA, proof of income, and asset verification. While the VA does not set a minimum credit score, most lenders generally require a score of at least 620 for manufactured home loans. Unlike traditional VA loans, manufactured home loans may require a down payment, often around 5% of the home’s value.

A VA appraisal is a mandatory part of the process, conducted by a VA-approved appraiser to assess the home’s fair market value and ensure it meets VA Minimum Property Requirements (MPRs). For manufactured homes, this appraisal includes verifying the permanent foundation and structural integrity. The appraisal is not a home inspection, though a separate home inspection is often recommended to identify potential defects. Finally, if all requirements are met, the loan proceeds to closing, where all final paperwork is signed.