Just wondering if anyone could help me with what the costs would be for closing and taxes on an established home in a rented lot community vs buying a new home on land that you buy. When you own the land do you pay taxes just on the land every year? How do the closing fees differ?
Thanks
Costs
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rmurray
Re: Costs
Home only finance in a park has a MUCH higher interest rate...Closing costs would be very low or maybe even none...BUT..the rates are VERY high..about 10% or more on used homes...as high as 14% with small downpayments..
The same home can be put on private property and financed as a home..at about 6.5% or less in rate...Of course you no longer have a lot rent payment...Closing costs of a good loan are about 4% of the total costs...Often these can be financed as part of the package...Downpayments can be as low as 3% and in some cases nothing...
Taxes very by state...but generally in a park you get taxes on the home only...some states this is very rasonable...in others it is not...Of course the property tax is included in your rent...and will go up over time..causing rent increases..
When included as private property...your taxes will be on the land and the home with 1 bill...Some states have homestead exemption that lowers taxes for owner occupied homes...Only your local tax assessor can tell you about what the taxes will be in either case...
thje big difference is in resale...When you resell in most parks (some exceptions to this rule where parks are very nice and in VERY good locations)...you will have a hard time recovering your investment...When you resell a land/home combo..appreciation should be the same as any home in the area...If the location is good..apprecaition can be very good..
The same home can be put on private property and financed as a home..at about 6.5% or less in rate...Of course you no longer have a lot rent payment...Closing costs of a good loan are about 4% of the total costs...Often these can be financed as part of the package...Downpayments can be as low as 3% and in some cases nothing...
Taxes very by state...but generally in a park you get taxes on the home only...some states this is very rasonable...in others it is not...Of course the property tax is included in your rent...and will go up over time..causing rent increases..
When included as private property...your taxes will be on the land and the home with 1 bill...Some states have homestead exemption that lowers taxes for owner occupied homes...Only your local tax assessor can tell you about what the taxes will be in either case...
thje big difference is in resale...When you resell in most parks (some exceptions to this rule where parks are very nice and in VERY good locations)...you will have a hard time recovering your investment...When you resell a land/home combo..appreciation should be the same as any home in the area...If the location is good..apprecaition can be very good..
The park that I am interested in has a lot rent increase of 5% per year. Sounds kind of high to me but it is in a nice gated park. The best interest rate I found for a lot rent home was 10.75%.-
rmurray
Re: Costs
If your credit is very good...and you can invest substancial cash..15% or so..you should be able to buy at a little better rate..
Lowest I have seen is 8.75% through a dealer on a new home...Some banks have specialized programs for what they call 5 star parks..In our area SouthTrust has just such a program..where rates with good credit get as low as 7.00%...
Shop around a little more....Good Luck...
5%/year compounded is 100% in about 11 years or about 500% in 30...YIKES
Lowest I have seen is 8.75% through a dealer on a new home...Some banks have specialized programs for what they call 5 star parks..In our area SouthTrust has just such a program..where rates with good credit get as low as 7.00%...
Shop around a little more....Good Luck...
5%/year compounded is 100% in about 11 years or about 500% in 30...YIKES
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