Mobile Home Financing
When you purchase a leased land home, there's technically no "real estate" (land) being sold. Instead, it's a transfer of personal property, otherwise known as chattel.
There are many lenders who specialize in chattel loans, and you may find that local banks can be helpful as well. Many will require 10% down if the home will be occupied as a primary residence, and 20-25% down if the home is a second or "investment" property.
Interest rates are typically a bit higher than those for real estate loans, and can be anywhere in the 5%-8% range or higher. Interest rates are usually tied to the size of the loan and the amount of money you'll be putting down. Therefore, larger down payments on higher priced homes will likely have the lowest nterest rates.
Your lender will also charge fees at settlement ("closing costs") related to items such as title searches, document preparation, courier fees, appraisals, credit checks and more.
While traditional home loans offer 30 year terms, leased land loans are more often amortized over 15 or 20 years. This is an important item to be aware of, especially when searching for homes online. Sites like Zillow.com and Realtor.com display possible monthly payments on the listings, but those figures may be based on a 20% down, 30 year fixed rate loan at 4.5%. Those terms are likely not available on a leased land home, making the figures shown unhelpful and inaccurate.
Working with a Realtor who specializes in leased land is the best way to begin your leased land manufactured home search. The team at CoastalMobile.com is consistently recognized as the leader in leased land home sales in Sussex County Delaware's beach towns and outlying areas. We can help you navigate leased land financing options and provide contact info for lenders who can help you today.