Veterans and active duty service members may be eligible for a special type of mortgage known as the VA loan, which is backed by the U.S. Department of Veterans Affairs (VA). VA loans are designed to support those who have served our country, offering them significant advantages like no down payments, limited closing costs, and more favorable terms than conventional loans.
However, a common misconception is that borrowers can’t use a VA loan for mobile home purchases. Many types of properties qualify for VA loans, including manufactured homes. Unfortunately, not all lenders allow you to purchase a manufactured home with their VA loan programs, but many do, including Griffin Funding.
Keep reading to learn more about using a VA loan for mobile home purchases to help you determine if you’re eligible for the benefits of this unique financing option.
VA loans are known for their versatility. However, we must clarify that VA loans for mobile homes are possible. Today’s modern “mobile home” is actually manufactured or modular and permanently affixed to a foundation. A traditional mobile home is “mobile,” so it doesn’t have a permanent foundation, making it easy to move. So, while VA loans can’t be used for traditional mobile homes built before June 15, 1976, they can be used for manufactured homes.
Manufactured homes are those built after that date and adhere to specific construction and safety standards. Therefore, getting a VA loan for a manufactured home is possible if you find a lender who offers them.
VA manufactured home loans aren’t offered by every VA loan lender. However, you can still use a VA manufactured home loan. What you can’t do, though, is use VA loans for mobile homes built before June 15, 1976, so keep that in mind.
Just like every type of home loan, VA manufactured home loans have pros and cons. Understanding these benefits and drawbacks will ensure you make the right decision for you and your family.
The pros of manufactured home VA loans are the same benefits you get when you use a VA loan for any other type of primary residence and include the following:
While VA loans for manufactured homes come with many benefits for eligible borrowers, they also have potential drawbacks, such as:
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While VA mobile home loans don’t technically exist because true mobile homes aren’t affixed to a permanent foundation, you may still qualify for a VA loan for a manufactured home if you and the property meet specific lending criteria.
Lending requirements vary by lender, so it’s important you understand the criteria before applying.
Before securing a VA manufactured home loan, you’ll need to determine if you’re eligible by obtaining your Certificate of Eligibility (COE) from the VA. This document confirms your entitlement to the VA home loan benefit. You’ll also need to meet your lender’s criteria, which means proving income and creditworthiness.
Additionally, the VA requires the property to meet specific standards to qualify for this loan. Generally, a manufactured home must be affixed to a foundation; thus, it can’t be a true mobile home.
As mentioned, both the borrower and property must meet certain requirements to qualify for a VA loan for a manufactured home.
The VA sets minimum property requirements (MPRs) for all properties purchased with a VA loan to ensure it’s safe, sanitary, and structurally sound. The VA requires that manufactured homes be affixed to a permanent foundation.
In addition to the VA’s requirements, the home must be classified as real estate to qualify for a home loan and meet construction standards legally mandated for manufactured homes.
The borrower must meet the VA’s and lenders’ requirements to qualify for the loan. The VA doesn’t set minimum credit score provisions, so they vary by lender, but most like to see a score of at least 620.
One of the benefits of VA loans for manufactured homes is that down payments aren’t necessary. However, if you’ve already used your entitlement and it hasn’t been restored, you may owe a down payment to cover the difference between the loan amount and what the VA will guarantee.
While the VA limits closing costs for borrowers, you’ll still be required to pay the VA funding fee. If this is your first time using the VA loan, your funding fee will be 2.15% of the loan amount. However, if you’re already using your entitlement, you’ll pay a funding fee of 3.3%.
While the VA manufactured home loan is a viable option for financing your home, they’re not the only form of financing available. If you want to purchase a mobile or manufactured home, there are other financing options available through Griffin Funding, such as:
VA loans for mobile homes—those not affixed to a permanent foundation—aren’t available. However, you can use a VA loan to purchase a manufactured home. Whether this option is right for you depends on your personal needs, financial situation, and long-term housing goals.
Unlike many other VA loan lenders, Griffin Funding offers VA loans for manufactured homes. We simplify the process of securing a VA loan, from obtaining your COE to closing the deal. Apply for your first VA loan with Griffin Funding today.
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Yes, you can get turned down for a VA mobile home loan. VA loans are only available for manufactured homes that adhere to strict construction standards. If the property isn’t permanently affixed to a foundation, it won’t qualify for a home loan because it’s considered personal property rather than real estate.
Even if the property is eligible, you, as a borrower, may not be. The VA and lenders have criteria you must meet to qualify for VA loans.
Securing a VA loan for a mobile home isn’t possible because of the VA’s property requirements and those of lending institutions. True mobile homes that aren’t affixed to a foundation are considered personal property. However, getting a VA loan for a manufactured home is possible, even though it may be more challenging.
Manufactured homes are seen as riskier investments due to potential depreciation concerns. Property condition criteria and site restrictions may also make it harder to find eligible properties.
Financing a manufactured home that’s been moved with a VA loan can be challenging. Many lenders and the VA typically prefer homes that remain on their original installation site due to concerns about structure integrity and potential depreciation after relocation.
Bill Lyons is the Founder, CEO & President of Griffin Funding. Founded in 2013, Griffin Funding is a national boutique mortgage lender focusing on delivering 5-star service to its clients. Mr. Lyons has 22 years of experience in the mortgage business. Lyons is seen as an industry leader and expert in real estate finance. Lyons has been featured in Forbes, Inc., Wall Street Journal, HousingWire, and more. As a member of the Mortgage Bankers Association, Lyons is able to keep up with important changes in the industry to deliver the most value to Griffin's clients. Under Lyons' leadership, Griffin Funding has made the Inc. 5000 fastest-growing companies list five times in its 10 years in business.
