Is it possible to get loans on modular homes and raw land from traditional financing?

Asked by Tylene Ashcroft, San Diego, CA Sat May 18, 2013

I would like to buy some raw land to have a modular home place, but don't know where to start with financing.

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John Arendsen, Agent, Leucadia, CA
Thu Jan 1, 2015
Are you talking MODULAR or MANUFACTURED? There's a big difference when it comes to financing, however, the answer is yest to both providint it meets the lender guidelines.
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Armando Villa, , Lamont, FL
Wed Dec 24, 2014
its called USDA Rural Development Loan
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John Arendsen, Agent, Leucadia, CA
Thu Jan 16, 2014
Tylene, we are a family owned, one stop, turnkey Factory Built Housing Dealer, Developer, general & Manufactured Home Contractor, Real Estate Broker and investor with over 100 years of real estate and manufactured/modular home experience in San Diego. Please feel free to contact us anytime.

760 815-6977
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leslie thome…, Agent, Riverside, CA
Wed Jan 15, 2014
Hi Tylene,

Modular financing is available. If you own raw dirt, the best place to start is with a modular developer that can walk you thru the design and development of your home. Starting with a modular architect is key. I can refer you to US modular owner and I can assist with the financing.

Please call anytime. 760-715-3114

Leslie Thomerson
Senior Loan Officer
NMLS 508360
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John Arendsen, Agent, Leucadia, CA
Sat May 18, 2013
They haven't built a " (PRE HUD) Mobile Home" since June 15, 1976. Since then they have been referred to as "HUD Manufactured Homes".

Generally speaking you can indeed get a land/home loan on both a "HUD Manufactured Home" and a "Modular Home" However, a HUD Mfg Home must be placed on an engineered certifies foundation and in some cases will require a California Housing & Community Development Department (HCD) 433a documentation in order to get a long term conventional loan.

The only problem, and it is a significant problem, is getting comps for HUD Mfg. Homes. If you place a HUD MH on a private parcel you run the risk of only being able to find the nearest comps in a "Resident owned" MFG Home condo, sub division or planned unit development (PUD) if there are no other MFG MH comps within geographical proximity to your home.

So if your land/home package is in let's say a $350k neighborhood and the closest comps are in a $150k MH community it's obvious that you would have a very tough time finding long term financing. This is where a lot of folks get stung big time.

They buy the land obtain a construction loan collateralized by the land and build the home. Then when they go for a "take out " long term loan that's when their troubles begin. Unless you're working with a qualified and experienced MH dealer and contractor who's had experience with this type of development you could get yourself in trouble. Many MH dealers are only interested in selling and delivering you a home regardless of what the potential outcome may be to you in the long run.

However, should you purchase a "Modular Home" instead of a "HUD MFG Home" the appraiser would then be able to draw comps from recent local sales of comparable properties and not have to draw from a MH community.

Modular Homes will cost a bit more than a HUD MH but at least you won't have to worry about take out financing. We are a one stop, turnkey family owned and operated Real Estate Brokerage, Manufactured Home Dealer, General & Manufactured Home Contractor, architectural and interior design company with over 100 years of combined experience in San Diego.

We can help you in your search for a lot/parcel, assist you with the selection of your home, prepare your plans for permit, pull any/all required permits, provide a turnkey developed project complete with all necessary site work i.e. grading, excavation, utilities, foundation, installation of your home and all ancillary items and structures i.e. garage, driveway, landscaping, sprinkler systems, patios & patio covers, etc.

Please feel free to contact us anytime at 760 815-6977 or email us at Feel free to log onto any of our very user friendly websites for further valuable and useful information:
0 votes
Great information. However, I hear insurance coverage and rates may soon become dificult in rural areas?
Flag Thu Jan 16, 2014
Simon Campbe…, Agent, Miami Beach, FL
Sat May 18, 2013
If you are putting a modular home (built to local standards, not HUD) on a permanent foundation, then you should be able to get a loan covering the whole package.

If you are putting a mobile home (i.e. steel undercarriage, HUD building standards) on land, you are going to run into trouble. Generally speaking, lenders will only finance the land. You would need to take out a personal loan to cover the home. If it is new, often the seller will offer some sort of finance options.
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Jim Fishinger, Agent, Carlsbad, CA
Sat May 18, 2013
Modular homes on land with a permanent foundation finance with any loan from Conventional to VA FHA if they are existing and have filed a document with the county called a 433. If you want to put all this together yourself it will require a "construction loan" that converts to permanent financing. Many commercial banks can provide such financing and it can be done with VA financing I am told if you are eligible. Be aware that there are costs beyond the initial cost of the land and the home, besides the construction of a foundation, you will have to pay to bring in needed utilities and pay various other fees for permits, schools fees, sewer connection fees, water connection fees and a meter. The cost for grading can vary greatly depending on soil conditions. I have some personal experience with this type of project and it almost always costs more and takes longer than it seems that it should. Having a competent, honest contractor who has experience in doing this type of work is critical.
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