As an expert in the field of modular homes, I have seen firsthand the benefits and potential pitfalls of this type of housing. Buying a modular home can be a great investment for buyers at all stages of their lives, especially if they want a home customized for them. However, there are a few things you should know before you know where to buy a modular home. In this guide, I will provide you with all the information you need to make an informed decision when purchasing a modular home.
What is a Modular Home?
Before we dive into the details of buying a modular home, let's first define what it is.A modular house is a type of structure built off-site, far from the place where it will be placed when assembled. These residences are built in sections called modules in a climate controlled indoor factory, where builders assemble them according to strict quality standards. The builder then sends each module to the site and assembles them to build the house. Once finished, the modular home is virtually identical to a newly built one and can have the same design features at a lower cost.
Location and Size
If you're buying land for your modular home, size and location are important factors to consider.Your lot needs enough space for your house to separate from neighboring houses. If you work with a modular home dealer, your seller can help you determine which designs meet the zoning requirements of your area.
Financing Options
In many cases, since modular homes are practically the same as traditional homes once completed, they offer similar financing options. However, there are some differences depending on the type of loan you're trying to obtain.Conventional Private Loan
Buying a modular home with a conventional private loan is similar to buying a standard home. In both cases, most lenders require a FICO score of 620 and a minimum down payment of 3 percent.VA Loan
If you or your spouse served in any branch of the U.S. Armed Forces In the United States, you may be eligible to obtain a loan from the Department of Veterans Affairs (VA) for your modular housing. These loans offer lower interest rates and are available to buyers with lower credit scores. However, VA loans are subject to eligibility requirements depending on your service history.
Bad Credit
You can still buy a modular home even if you have bad credit.However, it can be difficult to obtain a loan with an accredited bank or credit union. You could also have a higher interest rate on your loan payments, in addition to paying for mortgage insurance if you can't make a down payment of more than 20 percent.
Where to Buy a Modular Home
Are you thinking about buying modules? Preferred Homes works with many lenders who are familiar with the process and can meet your unique needs. We recommend getting a loan with one of our lending partners to begin the buying process.Construction Loans
A construction loan is a short-term loan that provides cash flow while your modular home is being built. By knowing the right questions to ask a modular home builder, you can ensure that you're choosing the one that best fits your needs.Financing Your Modular Home
Once the construction of a modular home is complete, it can be financed with a traditional mortgage just like an existing home.Whether you decide on modular or site-built construction, the most important thing is to work with a reputable builder you can trust.
Paying for Your Modular Home
But how do you pay for a modular home while it's being built? Builders often require upfront or installment payments before you move in. This is especially important if you're building a modular home because it's your own construction specialty. Asking the builder about the construction process is a great way to clear up any confusion you may have about building modular homes.USDA Loans
If you want to place your modular home on rural land and buy it with the help of a USDA loan, you're in luck. These loans offer low interest rates and require no down payment, making them an attractive option for many buyers.Choosing the Right Builder
When building the modular home of your dreams, the first step is to hire an experienced and trusted modular home builder.Choosing a modular home can save you money and time compared to traditional construction methods for a single-family home. In general terms, modular home delivery costs are calculated based on the distance the cargo must travel. Ask your modular home builder what sustainable building materials and what energy-saving options they offer. Familiarize yourself with aspects of the construction process so that, when you sit down and ask your modular home builder questions, you are confident in your previous knowledge.
In Conclusion
Buying a modular home can be a great investment, but it's important to do your research and ask the right questions before making a decision.With this guide, you now have all the information you need to confidently navigate the process of buying a modular home. Whether you're a first-time buyer or looking to downsize, a modular home can be a great option for customizing your living space and accumulating capital. So don't hesitate, schedule a visit with us today and we'll be happy to answer any questions you may have.
