Housing prices continue to rise, so purchasing a home as a low to middle income buyer can be difficult. Fortunately, manufactured homes provide affordability to today’s buyers. Therefore, service members, military Veterans, and surviving spouses want to know – Does VA loan on manufactured homes? When it comes to qualifying for a purchase or refinance, the property must meet the VA loan manufactured home permanent foundation requirements. Certainly, an area of confusion for many revolves around many popular manufactured questions. So, let’s dig into the answers and make a no money down manufactured home a reality!
Does VA Loan on Manufactured Homes?
First, let’s discuss VA lending and manufactured homes in general. Although finding a lender may be tough, the Department of Veteran Affairs guidelines allow financing. Furthermore, we provide VA loans just like any other property type allowed. That means no a money down purchase, cash out refinance up to 90% of the value, and a streamline refinance to lower a rate and payment (called a VA IRRRL). Basically, if the property meets the following, then it should meet VA requirements…
- Doublewide home or larger **
- VA approved permanent foundation
- Home permanently attached to land as real property
- Primary residence (check out options here)
- Meets VA minimum property requirements
So, the short answer is “YES!”. VA is probably the best way to finance a manufactured home and land. Besides no money down, advantages include no monthly PMI (keeps the payment lower), fixed and adjustable rates available, flexible guidelines, and more.
The manufactured home and site must be considered a real estate entity in accordance with state law and meet all local zoning requirements for real estate. The home must be built to HUD manufactured home construction and safety standardsVA Handbook, Chapter 12: Minimum property requirements
** VA allows for singlewides although we currently cannot finance these
How Old Can a Manufactured Home be for VA Financing?
Another extra guideline someone may find is a limitation on the home’s age. It is common to hear 5 or 10 year old age limits for the home. Again, this is not a VA guideline. Actually, the VA age limit is the home must be built after June 16, 1976. Keep in mind that the home must be in good condition, appraise well, and have sufficient insurance coverage. Obtaining sufficient insurance to cover the loan or replacement cost is difficult on older manufactured homes.
VA Loan Manufactured Home Permanent Foundation Requirements
Obtaining a traditional mortgage to buy a manufactured home with land means ensuring that the home is permanently attached to the property. When using an FHA, conventional, or USDA loan, that involves a structural engineer or architect inspecting the foundation to ensure it meets HUD or local requirements. Although, VA loans are a little different. On VA loans, the VA appraiser is the one which determines if the manufactured home permanent foundation meets standards.
VA appraisers are expected to know state and local regulations governing manufactured homes. Therefore, appraisers are also looking for missing HUD labels, modifications, additions, or other key areas to ensure compliance.
By the way, did you catch that I said USDA manufactured home foundation requirements? Most do not know this, but USDA will allow a no money down purchase of a brand new manufactured home. That’s right, a brand new, never occupied manufactured home is eligible for a USDA loan!
VA Appraiser Inspects the Foundation
During the VA appraisal inspection, the VA appraiser not only determines the size, condition, and value of the home, but also inspects a manufactured home foundation. Therefore, VA loan manufactured home foundation guidelines require that the home must be placed on a permanent foundation, constructed to withstand both supporting loads and wind-overturning loads, that meets state and local requirements.
Structural Engineer Inspection
So, a structural engineer foundation inspection is not required UNLESS the appraiser cannot determine if the foundation meets VA minimum property requirements. At this point, the VA appraiser would require a foundation inspection to ensure it is permanent.
New Construction Doublewide
When building a new manufactured home, VA considers the property as “proposed construction”. Then, the following must be provided to the VA appraiser up-front:
- Foundation plan
- Floor plan with room layout and exterior dimensions
- Elevation plans
- Specs for flooring, heating, plumbing, electrical equipment, appliances, and other items included with the home
Do you have VA eligibility and considering the purchase of a manufactured home? Let’s have a conversation.