Paying for a new home on its own land
Most people pay for a finished home on acreage the way they'd pay for any house: with a mortgage from a lender, or with cash. Here's how that works for a new HUD-code manufactured home, and how it differs from financing land and a house separately.
We're not a lender. Talk to one about your situation. We don't make, arrange, or recommend loans. This page explains how the loan programs work. It isn't an offer of credit.
Mortgage or chattel
Two kinds of loan, and the property decides which one fits.
A mortgage is a loan on real estate: the house and the land together. A chattel loan is a loan on the house alone, as personal property, the way a truck is financed.
Which one applies depends on how the property is set up, not on what the buyer prefers. A home on land somebody else owns usually can't get a mortgage. A home that is part of the real estate can. Ours are set up for a mortgage.
Foundation and title
Two things make the home part of the real estate.
The home-loan programs below share one core test: the house and the land have to be a single piece of real estate. Two steps make that true.
- A permanent foundation
- The home is set on a permanent foundation, and the hitch, axles, and wheels come off. FHA and USDA both spell this out, and USDA asks for a certification that the foundation was done right. Each of our home's pages has a row for the engineer's foundation certification, filled in once the paperwork arrives.
- The title is cancelled
- A manufactured home starts out with a title, like a vehicle. Before closing, that title is cancelled under Oklahoma law and the home becomes part of the real estate. From then on it's taxed as real estate, which is what the loan programs look for.
The loan programs
The common ways buyers pay.
A lender decides which programs fit you and what the terms are. These are short descriptions of each program, taken from the agencies' own rules.
One thing to ask about: FHA has a separate "Title I" program for manufactured homes with its own limits. The FHA mortgage most people mean is a different one. If a lender says "Title I," ask which program they're quoting.
- FHA
- FHA insures mortgages made by lenders. It can insure a mortgage on a manufactured home when the loan covers the home and the land together, the property is classified and taxed as real estate, and the home carries its HUD certification label.
- Conventional
- An ordinary mortgage that isn't government-backed. Under Fannie Mae's rules, the home and the land must both be legally classified as real property under state law.
- USDA
- USDA's Single Family Housing Guaranteed Loan Program backs loans made by lenders for homes in eligible rural areas. Two things decide eligibility: the property's address, and the household's income, which has to be under a set limit. The home has to be the buyer's main residence.
- For a manufactured home, USDA requires a new home on a permanent foundation with a foundation certification, taxed as real estate.
- Check an address and income on USDA's eligibility site
- VA
- VA-backed loans are made by private lenders, and the VA backs them. VA lists buying a manufactured home as one of the uses. The first step is a Certificate of Eligibility from the VA.
- VA's page on purchase loans
- Cash
- No lender and no loan conditions. Closing waits only on the title work.
Finished or built in pieces
Buying it finished is a different loan from building it yourself.
- A finished land-home (what we sell)
- The land, the groundwork, and the house are done before you buy. It's one property with one closing, and the mortgage is on finished real estate.
- Land first, then the house
- You buy raw land, with cash or a land loan. Then you pay for the site work and the house, often with a construction loan that pays out in stages as the work gets done, and later a mortgage on the finished place. Each step is its own application and its own closing.
- USDA and land on its own
- USDA's guaranteed program won't back a loan used to buy a lot unless the loan also pays for a new home on it. Land by itself isn't what that program is for.
When you're ready
Your lender will want paperwork. We have it.
Each home's page has rows for the foundation certification, the HUD label, and the set-up inspection, published as the paperwork arrives. We'll send your lender anything we have the same day they ask.