How to Buy Land and a Manufactured Home

Combining land ownership with a manufactured home offers a path to homeownership. This approach provides flexibility in location and is a more affordable alternative to traditional site-built housing. It involves understanding financing, land preparation, and the purchase and installation processes.

Understanding Manufactured Homes and Land Considerations

A manufactured home is a structure built in a factory to the Manufactured Home Construction and Safety Standards (HUD Code). These homes are transported in sections on a permanent chassis and display a certification label. Unlike modular homes, which follow state and local building codes, manufactured homes adhere to a single national standard.

Manufactured homes are categorized by their width and number of transportable sections. Single-wide homes consist of one section, offering a compact option. Double-wide homes are made of two sections joined on-site, providing a more spacious layout. Triple-wide homes, built from three or more sections, offer expansive living spaces.

Selecting the right land parcel involves evaluating factors. Zoning regulations dictate where manufactured homes can be placed. Verify the land is zoned for residential use and allows manufactured homes. Restrictive covenants in property deeds can also impose limitations and should be reviewed.

Accessibility ensures the site can accommodate large delivery vehicles. Availability of utilities like water, sewer, electricity, gas, and internet is important. If municipal services are unavailable, the land must be suitable for a well and a septic system, which may require a perc test.

Soil conditions on the property are important for stability and drainage, as poor soil may require additional preparation. Soil tests determine load-bearing capacity and drainage, influencing the foundation type. Environmental factors, such as flood zones or potential contaminants, also require investigation to ensure compliance with regulations.

Financing Options

Securing financing for both the land and a manufactured home involves navigating various loan types, each with specific requirements and considerations. The approach to financing often depends on whether the land is purchased separately from the home or together as a package.

For land-only purchases, raw land loans are available, often requiring a substantial down payment. These loans usually have shorter repayment terms and higher interest rates compared to traditional mortgages. Owner financing, where the seller directly provides the loan, can be an alternative offering more flexible terms.

When financing a manufactured home only, chattel loans are a common option. These are personal property loans, similar to vehicle loans, and usually have higher interest rates and shorter terms than real estate mortgages. The Federal Housing Administration (FHA) offers Title I loans specifically for manufactured homes. These loans offer lower down payment requirements and competitive interest rates.

Financing the land and home together involves options that classify the manufactured home as real property. Conventional mortgages, including those from Fannie Mae (MH Advantage) and Freddie Mac (CHOICEHome), may be available if the home meets specific criteria. These programs offer more favorable terms, similar to traditional home mortgages.

The FHA Title II loan program is for manufactured homes permanently affixed to a foundation on land owned by the borrower. This option offers low down payments and can cover both the home and the land. VA loans are available for eligible veterans, often requiring no down payment. USDA loans support low-income individuals in eligible rural areas, potentially offering 100% financing.

Financial considerations like down payment requirements, interest rates, and credit scores influence eligibility and loan terms. Lenders review income, employment history, and credit reports to assess financial stability. Pre-qualification provides an estimate of how much a borrower can borrow, helping to set a realistic budget. Gather necessary documents for the formal application.

Site Preparation and Permitting

Preparing the land for a manufactured home involves physical and regulatory steps before the home’s arrival. A site survey confirms property boundaries and assesses topography. Soil tests determine composition, load-bearing capacity, and drainage, influencing the foundation type. For properties without municipal sewer, a perc test assesses soil’s ability to absorb wastewater for a septic system.

Utility hookups are a key part of site preparation. This involves ensuring access to water, electricity, and potentially gas or propane. If municipal water and sewer are unavailable, plans for well drilling and septic system installation must be in place. Electrical service and gas or propane lines are installed based on the home’s needs.

The foundation for a manufactured home can vary, with common types including concrete slabs, pier and beam systems, or full basements. The choice depends on soil conditions, local building codes, and the home’s requirements. Proper grading and drainage are also important, ensuring water flows away from the home’s foundation to prevent damage.

The permitting process ensures compliance with local building codes and zoning ordinances. Multiple permits are required before construction, including a general building permit for installation, zoning permits, and specific permits for utility connections. Requirements vary by jurisdiction. Consult local building departments early to understand necessary approvals and fees.

The Purchase and Installation Process

The acquisition of land and a manufactured home proceeds once financing and site readiness are underway. The land purchase begins with an offer and negotiation. After an agreement, a purchase agreement is signed, followed by a due diligence period for title search and inspections. The process culminates in a closing, transferring ownership and finalizing transactions.

The manufactured home selection process involves choosing a dealer and customizing the home’s floor plan, features, and finishes. After finalizing specifications, a purchase agreement is signed with the dealer, detailing price, options, and delivery timeframe. Delivery is coordinated between the dealer, transportation company, and site preparation crew.

The delivery and installation phase involves transporting the manufactured home in sections to the prepared site. Teams place the home onto the foundation, level it, and secure it according to guidelines and codes. Utility hookups for water, sewer or septic, and electricity are then completed, connecting the home to site services. This phase ensures the home is structurally sound and ready for occupancy.

Before final occupancy, local authorities conduct inspections to ensure the home’s installation complies with building codes and safety standards. Upon successful completion, an occupancy permit or certificate of occupancy is issued, signifying the home is safe and ready for habitation.

The titling process for a manufactured home varies depending on whether it is treated as personal or real property. Initially, manufactured homes are often titled as personal property, similar to a vehicle. To qualify for traditional mortgages or increase property value, many owners convert the home to real property. This conversion involves removing the personal property title and recording it as part of the real estate deed.