HOW CAN WE GET THESE FINANCED?
As with all mortgages there are general guidelines, no guarantees, and all applicants are considered on a case by case basis. There may be exceptions made by the lenders and insurers. Both the applicant and the property must meet their criteria.
MOBILE HOMES ON THEIR OWN LAND
- The home needs to be permanently affixed to the property.
- Applicants can purchase with a minimum down payment of 5%.
- CMHC insurance is typically required regardless of the loan to value.
- Interest rates in most cases are fully discounted. Regular mortgage insurance premiums apply.
- AGE : All lenders have a cap on how old the mobile home can be, most prefer not to finance anything older than 15 More aggressive lenders will do an appraisal to determine the remaining economic life of the mobile home, and then offer a maximum amortization of 5 years below this number.
For Example: If the Mobile home is from 1980, however has undergone renovations (new windows, siding etc.) the appraiser may give it another 25 years of economic life. The bank will then offer a maximum amortization of 20 years and the client must qualify for payments based on this amortization.
- RENTALS: Very few lenders will consider a mobile home as a rental property. The mobile will likely have to be a newer one and the clients very strong. Owner occupied properties or second homes for (family members) are preferable.
- SIZE: Certain lenders will only finance double wide mobile homes. All lenders have minimum square footage requirements.
MOBILE HOMES ON LEASED LAND
Most of the same principles as above apply, however these properties are less desirable to the banks and can be more difficult to finance for the following reasons:
- The lenders must add the lot fees to their debt servicing calculations. This will have a large impact on a buyer’s loan approval limit
- Buyers will pay posted rates 2-3% higher than current discounted mortgage rates.
- Though the minimum down payment is technically 5%, most lenders will require more.
- Without land ownership, this is a chattel loan. The bank assumes the asset will depreciate.
Call me anytime, I am always available to answer questions you may have.