Mobile Home Refinance Options - The Bills.com Blog
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Mobile Home Refinance Options
Question: Why is it so hard to find a bank to refinance a mobile home?
Answer: Generally speaking, lenders do not like to offer refinance loans on mobile homes because, unlike homes that are built on permanent foundations, which tend to gain value over time, mobile homes tend to lose value, or depreciate, as time passes. Refinance lenders take a security interest in a home on which they lend money,in case the borrower defaults on the payments, allowing the lender to foreclose on the home. During a foreclosure, a lender will sell the home to recoup as much of their money as possible. However, since mobile homes tend to lose value over time, it is much more difficult for lenders to get their money back through a foreclosure. For example, if a lender loans you $50,000 on your home based on its current value, and you default on your payments 10 years later, the lender may only be able to sell the property for $10,000, meaning the lender would lose a significant amount of money in the process.
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lenders, Bills.com makes it easy to compare mortgage offers and different loan types. Please visit the loan page and maybe you can find a loan that meets your needs at:
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While most standard lenders do not offer refinance loans on mobile homes, some specialty lenders will allow borrowers to refinance their mobile homes. You should keep in mind that loans on mobile homes are not the same as standard mortgage loans. Rather, they are generally referred to as personal property loans, and carry higher interest rates and shorter loan terms than regular mortgages. If you are
interested in obtaining a refinance loan for your mobile home, you should look for a specialty lender who offers mobile home refinancing, such as http://www.mhloans.com
Again, you will probably pay a higher interest rate on a mobile home refinance loan than a standard home loan, so refinancing your mobile home may not be a sound financial decision. You need to make sure that the interest rate being offered to refinance your home will not cause you further financial problems.
I hope this information helps you Find. Learn. Save.
Best,
Bill
www.bills.com
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1. Posted by Jeffrey Best on Tuesday 2nd October 2007 09:31
I have an older singlewide mobile on about five acres. The mobile does not have much value and no mortgage company will touch me but the land is valued at about 125k by the county. Is there any way to refinance using the land value?
2. Posted by Bill on Tuesday 2nd October 2007 16:52
Most banks won't finance mobile homes, the major reason for this is that the current default or foreclosure rate for mobile homes is far in excess for that of stick built homes or single family residences. Land finance is a highly specialized field. To do it right, requires a detailed knowledge of how these transactions work. You can still refinance but your options are limited as follows: 1. Lower your rate and payment: Yes. Credit must be at least good to excellent. Minimum credit scores = 620. Full income documentation. 2. Cash Out / Home Equity Loans: Not allowed for single wide homes. 3. Debt Consolidation / Pay off Bills: Not allowed for single wide homes. Try a small local bank who will know the land values and local market.
3. Posted by Sherry on Wednesday 27th February 2008 10:49
We have a singlewide and are going to be buying a modular home to go on our land. We have several small bills and are not sure which is our best bet to pay off the small bills which could take several years or by our modular and get a second mort. and pay off all of the bill. How soon can a second mort. be taken out on a new home and do you think this would be a good idea?
4. Posted by Bill on Wednesday 27th February 2008 12:52
You do not have to wait to apply for a second mortgage, but my concern would be to find the right lender. YOu are inquiring about a second mortgage, which makes me assume that you already have primary mortgage that you pay on. I would contact them to see what your options could be. As far as whether this is a good decision, my answer would be no. You only borrow against your home to make improvements on your home, remember that you are putting your home on the line for the sake of these small bills. I would think twice before I did so.