Financing for Land Owned MH

[gk]

Hi

My wife and I have our eyes set on a particular property in Westlake Village, CA. It is technically a mobile home park, but each person owns the land (approximately .25 acres) and the homes all look and feel like permanent structures - almost all have additions built onto them, permanent foundations, etc.

The property we're interested in has these qualities as well (permanent foundations, substantial addition, etc), and is in excellent condition. However the original MH was built just before june 1975 (which I think is the cutoff date for FHA and most loan programs - at least that's what we've been told). In addition, it is a bank owned property, and they are asking for cash only (I assume because of the potential financing problems).

In any event, we're looking for whatever insight / assistance we can get. We're a bit discouraged that we wouldn't be able to get financing based on a technicality such as just being built before a cutoff date.

Any advice would be greatly appreciated.

Thanks so much.
gk

[David Oxhandler]

The cut off date is NOT a technicality. Lenders are reluctant to put money behind homes that were built prior to the federal HUD code that first set standards for the construction of manufactured homes in 1976. As a buyer you should also be aware of the possible pitfalls.

Just as site built homes are constructed according to a specific building code to insure proper design and safety, today’s manufactured homes are constructed in accordance with the HUD building code. This code regulates manufactured housing design and construction, strength and durability, transportability, fire resistance, energy efficiency, and quality control. It also sets stringent performance standards for the heating, plumbing, air conditioning, thermal, and electrical systems.

Homes built prior to the adoption of the HUD code were not built to any specified national code or standards. Some builders did a great job, building homes to travel at 60 mile per hour over all types of road conditions. BUT others were built very poorly using sub-standard materials. Some of the old homes I have renovated have 2x2s in place of 2x4s in the exterior walls, others literally had corrugated cardboard for flooring.

As lenders can not be sure how a particular pre-code homes was constructed, they must question how well and for how long that home will continue to be useful. Not knowing if the home will out last the loan creates a justified reluctance to invest in them.

I understand your frustration. There are loads of great old manufactured homes out there that were built very well. Remember you are not alone in this problem. The sellers will not be able to sell unless he can find a cash buyer. Talk to them about owner financing.