If you’re a veteran, active-duty service member or a qualifying spouse, you’re likely familiar with the advantages of VA home loans. But you might not know that you can also use a VA loan to buy a mobile home or manufactured home. While most people think of VA loans in terms of traditional houses, they’re available for other property types, too, including mobile homes as long as certain criteria are fulfilled.
What Is a Mobile Home?
Before we get into the nitty-gritty of VA loans, let’s look at what constitutes a mobile home:
- Mobile homes (and manufactured homes) are prefabricated buildings that are manufactured in a factory and then transported to a site for installation.
- Your mobile home must be permanently attached to a foundation and eligible for HUD standards to qualify for a VA loan.
- It is generally considered real property only after it is affixed, and titled as such.
Note: RVs, campers and houseboats are not eligible under the VA loan program.
Is it Possible to Use a VA Loan on a Mobile Home?
Yes, you can! But purchasing a mobile home with a VA loan is a little more complicated than buying a traditional stick-built house. That’s because lenders perceive mobile homes to be higher-risk because of depreciation and mobility.
While the VA does not issue loans, it does provide a guarantee of a portion of the loan issued by authorized lenders. This means you’ll have to locate a VA Approved lender that’s willing to finance mobile homes, which could be more difficult to do when compared with traditional properties.
Eligibility Requirements
To be eligible for a VA loan for a mobile home, you will need to meet the same overall VA loan eligibility requirements, including:
- You are an eligible veteran, active-duty service member, National Guard, Reservist or surviving spouse.
- You hold an approved Certificate of Eligibility (COE).
- You qualify for the income and credit standards set by the lender.
- You plan to make the mobile home your primary residence.
Property Requirements
Besides being personally eligible, the mobile home must also be conditionally eligible:
- Permanently affixed to a foundation that meets VA standards.
- Taxed as real property (not personal property) and classified as real property.
- Designed to comply with HUD Manufactured Home Construction and Safety Standards
- For most lenders, the home has to be double-wide or bigger (single-wides are tougher to finance).
- Scoring of the property through a VA appraisal must meet Minimum Property Requirements (MPRs).
What Can You Do With a VA Loan?
You can use a VA loan to:
- Manufactured home (MH) + Lot Purchase
- Purchase a used manufactured home and lot
- Purchase a modular home and install it on land you own
- Make a joint purchase of the land and the house
- Refinance a VA or non-VA mobile home loan
- PMA (Professional Manufactured Approved): A PMA is an approval stamp that is used to allow construction companies to renovate or fix a manufactured home.
Benefits of Using a VA Loan for a Mobile Home
- No down payment required (in most cases)
- No need for private mortgage insurance (PMI)
- Competitive interest rates
- Lenient credit requirements
- Assumable loan (can pass to another qualified buyer)
- Closing cost limitations
- Guaranteed by the Department of Veterans Affairs, providing lenders additional security
This allows those who have served the ability to be able to own their home to become more accessible and affordable for all.
Challenges to Be Aware Of
Although VA loans come with amazing benefits, there are some obstacles specific to mobile homes:
- When it comes to mobile or manufactured homes, fewer lenders are willing to finance them.
- Depreciation risk: Mobile homes are unlike regular homes and will (often) lose value over time.
- Tighter property standards: The home must pass HUD and VA guidelines, which can rule out older units.
- Permanent foundation: Mobile homes must be placed on a permanent foundation, which can incur extra costs.
How to Apply for a VA Loan for a Mobile Home
Step 1: Get Your COE
You can complete your Certificate of Eligibility via the VA eBenefits portal or through your lender.
Step 2: Find a VA-Approved Lender
Not every VA-approved lender has mobile home loans. Identify lenders that focus on VA construction loans or VA manufactured home loans.
Step 3: Get Prequalified and Pre-approved
Talk to the lender about your income, credit, and financial goals, and get prequalified and pre-approved.
Step 4: Choose the Property
Find a mobile home that meets VA property requirements. You may choose from:
- A home on private land
- A home in an approved mobile home park
- A new manufactured home from a dealer
Next Step 5: VA Appraisal and Underwriting
Lender requests VA appraisal to make sure property meets necessary guidelines. Then your loan will go through underwriting.
Step 6: Close the Loan
After approval, you will sign the contracts and get the keys to your new home.
Avoid These Common VA Mobile Home Loan Mistakes
- Partner with VA lenders with experience in the mobile home process.
- Buy newer models that are more likely in HUD specs.
- When placing on land, there should be appropriate zoning in place for the land, as well as utilities available.
- Talk to your lender about loan term options: Many VA loans for mobile homes come with shorter terms (20–25 years) than traditional mortgages.
Final Thoughts
A VA loan for a mobile home could be an affordable way for veterans and active-duty service members to become homeowners. However, while there are some additional hoops to jump through, the benefits such as no down payment, no PMI, and competitive rates make it worth at least checking out.
If a mobile or manufactured home is what you’re thinking about, you’ll want to get in touch with a VA loan professional that knows the guidelines and can walk you through with the utmost confidence.