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Manufactured homes can be a great option for some Veterans and service members using their VA loan benefit. Many manufactured and modular homes meet the VA’s minimum property requirements, and Veterans are taking advantage.

Manufactured homes, often referred to as “mobile” homes, are built in a factory to meet building codes set by the U.S. Department of Housing and Urban Development. They have permanent steel frames and are made to be moved to location either in sections or as one structure.

VA Loan Requirements for Manufactured Homes

If you’re interested in using your VA loan benefit to purchase a manufactured mobile home, there are a few things to keep in mind. The VA requires the following:

  1. The home and property must be considered real estate by state law and meet all local zoning requirements
  2. Single-wide manufactured homes must have at least 400 sq. ft., and double-wide homes require at least 700 sq. ft. .
  3. It must be on a permanent foundation

Manufactured homes have a tag on the outside of the home noting they meet codes and regulations required by the U.S. Department of Housing and Urban Development. It is essential to know what is and is not a manufactured home, as some VA lenders will not make loans for manufactured housing, as guidelines and policies vary by lender.

What is the difference between a manufactured and modular home?

A modular home is not the same as a manufactured home from a VA loan standpoint. Although the parts or sections of a modular home are built in the factory and then moved to the building site, the home must still be assembled and completed at the building site. A few important distinctions about modular homes as it pertains to the VA loan include:

  1. Modular homes must meet local building codes, which are likely more strict than the federal guidelines required for manufactured homes
  2. Modular homes often hold value better than manufactured homes and are often comparable to common, stick-built homes
  3. It is much easier to find a VA lender for a modular home than a manufactured home

What to Know Before Applying

Many manufactured or modular homebuyers work with a builder to build a new home. Before applying for a VA loan for a new manufactured or modular home, Veterans should understand that it can be challenging to find a lender willing to do a true $0 down construction loan.

Borrowers often acquire a short-term construction loan from their lender or builder, then refinance that loan into a VA mortgage after the home is complete.

Typical Uses of VA Loans for Manufactured Homes

You may use a VA-guaranteed loan to:

  • Buy a manufactured home and/or lot
  • Buy and improve a lot on which to place a manufactured home you already own and occupy
  • Refinance a manufactured home loan in order to buy a lot
  • Refinance an existing VA manufactured home loan to reduce the interest rate

What factors should be considered in choosing a site?

To use a VA home loan, your home and land need to meet VA loan minimum property requirements. If you are placing a manufactured home on land you are buying or already own, consider how far away the utilities are and the cost of hookup. If service from a public or community water or sewage system is not available, find out if the groundwater and subsoil conditions are satisfactory for an individual well and/or sewage disposal system.

If a manufactured home is sold, can the VA loan be assumed?

Yes. However, for loans made after March 1, 1988, the Veteran is required to apply for approval of the assumption and release from liability to the holder of the loan. If the loan was obtained before that date, it may be assumed without the approval of the loan holder or VA. Still, the Veteran will usually remain liable on the loan unless they apply to the VA for a release from liability and the VA grants the release in writing.

Can a Veteran get more than one VA manufactured Loan?

Yes, if you qualify for restoration of entitlement or have enough entitlement left to buy another manufactured home and dispose of the previously manufactured home.

Talk to a VA lender to learn more about financing your manufactured home with a VA loan.

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