Financing

[VEE]

What would be the best way to finance my Norris 2000 sq ft plus home?

I will be putting the home on property that is owned clear and free. I also have a home to sell as soon as I get the new home to move to.

Is there a bank that gives better deals and understands the mobile home purchases?

Any info would be appreciated.

I will be making the deal on this Norris the end of next week.


Thanks,

Vee

[rmurray]

There are 2 ways to finance your home...
1 is to finance home only..this will require a cash down-payment of 5% or more..terms can be to 30 years but most often about 25 years now...rates are credit and down-payment sensitive...For 5% down and moderate credit..rates will be about 10-11%...with 20% down and great credit rates can be as low as 7%..all with NO closing costs...In this case the land is not part of the loan...but if the loan goes bad..the lender has the right to sue..then take the land.

2..is to finance as a home mortgage...with free and clear land..and credit that you would have to have to get any home only loan...the rates today are about 5.75% with about 5% in closing costs which can be financed..You would have 0 cash commitment (often lender will require you pay a few costs cash..about $500) and very low payments...With small amount of cash and normal credit you will save over $3000 a year in interest...seems that mortgage finance is a no brainier..

Good Luck..

[Kevin]

Murray, if he is going to use the equity from the sale of his stick built house to pay off the MH, doesn't it make more sence to go with the home only loan? Wouldn't that actually save him money because of no closing costs? The reason I ask is that's what I plan to do. 20-25% down and pay off the loan when I sell my stick built. Thanks.

[rmurray]

The poster never said they were going to pay off the new home...

If they were...yes you are right..clean...no cost home only would be cheaper if it is paid off in 2 years or so...although many are keeping their cash and borrowing at these low rates..expecting that prudent investments can earn far more than the current low mortgage rates...

Just remember...if you do the home only loan...do not allow the rate to be bought down..that can ad as much as 8% to the principle balance..

[VEE]

I do plan to sell my current home as soon as I get the new home in and set up...so I can move in to it.

I think I will go with the #2 answer Murray in your first reply. I will be seeing a banker Thursday and here's hoping I can get a good deal. The gal at the bank said to get a construction loan with 10 80 10 disbursements for 6 mos at 4.75% and in the meantime try to sell my home and if it doesn't sell then she thought I should go to West Virginia Housing Loan (which would be a fixed loan for 10 yrs or 20). This is just info I got over the phone. I am not sure what that WV Housing Loan is. I will get all of my ducks in a row and will know the nitty gritty before I sign the dotted line.

Thanks to you all. I will keep you posted as to how everything goes.

VEE