Manufactured Home Conventional Loan Guidelines Explained (2024)

Have you seen home prices lately?

Yes you have. Which is why you're probably considering a manufactured home. For many first-time and even repeat buyers, it’s an affordable alternative to site-built homes.

But how do you finance these homes? Can you get a conventional loan on them?

The good news is that there are plenty of ways to get a mortgage on a manufactured home, including a conventional loan.

Request Your Conventional Loan Pre-Approval. Start Here.

Should You Buy A Manufactured Home?

The question that should be asked first is whether a homebuyer should consider a manufactured home.

There are pros and cons to this strategy. Buying a manufactured home is not without risk. Here’s what to consider.


More affordable: You can often find a manufactured home at half the cost of a site-built home in many markets.

Less competition: Most buyers are in the market want site-built homes. You will have less competition from other buyers and may be able to make below-market offers.

Modern designs: Most newer manufactured homes come with designs that make them look more like site-built homes.


Depreciation: The manufactured home structure itself depreciates over time. While the land it sits on may appreciate, the structure loses value as time goes on. Well-built and maintained site-built structures generally appreciate over time along with the land.

Land rent: Some manufactured homes are on rented land. These are not eligible for traditional financing. And, they can come with sky-high monthly land rent costs.

Harder to sell: There is less demand for manufactured homes since most buyers are only interested in site-built homes.

Manufactured Home Eligibility Requirements

If you’ve decided a manufactured home is for you, here’s what to look for.

A manufactured home must meet the following criteria to be eligible for a conventional loan offered by Fannie Mae or Freddie Mac.

  • It must be permanently attached to a foundation with tow hitch, wheels, and axles removed

  • The vehicle title is eliminated and is classified as real estate

  • It must have been built on or after June 15, 1976

  • The home is at least 12 feet wide and 400 square feet (600 square feet for Freddie Mac)

  • A HUD Data Plate and HUD Certification Label are attached to the home (more about this below)

  • The home was never previously installed at another location

  • The borrower owns the land on which the manufactured home sits unless in a condo project. Leased land is not allowed

  • The home is connected to utilities and located on a publicly or privately maintained street

  • There is no accessory dwelling unit (ADU) on the property

  • Incomplete additions or renovations are not allowed; completed renovations must meet local code and may require an inspection

  • Single-wide homes are often eligible under stricter requirements; many lenders will only accept multi-wide manufactured homes.

See if You Qualify for a 2024 Conventional Loan

Conventional Loan Requirements for Manufactured Homes

Manufactured homes are generally more difficult to finance than site-built homes. Lenders view these structures are riskier, since they are harder to sell on the open market and can depreciate over time.

Following are conventional loan requirements for manufactured homes.

  • Primary residence (second homes and investment properties are allowed with larger down payments)

  • 5% down in most cases

  • Minimum credit score of 620

  • Mortgage insurance required for down payments of less than 20%

  • 30-year fixed rate, 7- or 10-year adjustable-rate mortgages only

  • Mortgage rates are higher

What is MH Advantage?

MH Advantage is a special program offered by Fannie Mae and Freddie Mac that allows similar financing as site-built homes.

With this program, the standard manufactured home interest rate increases are waived. Additionally, you can put 3% down instead of 5%.

To meet MH Advantage requirements, the home must be built to specific standards defined by Fannie Mae and Freddie Mac. And, the home must have the MH Advantage label, typically found by the HUD data plate.

If you are considering a manufactured home, ask the seller’s real estate agent whether the home qualifies for MH Advantage.

What are the HUD Data Plate and HUD Certification Label?

The HUD data plate and HUD certification label are important pieces of the manufactured home loan approval. Without them, the loan can’t be approved.

HUD data plate: A paper document that details manufacturer information such as the model number, factory-installed equipment, and more. This can be found in the interior of the home, typically in a utility closet or other indiscrete area.

HUD certification label: A metal tag on the exterior of the home verifying the structure was built to HUD standards.

Manufactured Home Conventional Loan Guidelines Explained (1)

Source: IBTS

The manufactured home appraisal must have pictures of these two documents. If there is no data plate in the home, a letter with the same information may be available from the Institute for Building Technology and Safety (IBTS) for a fee.

Conventional Loan Alternatives For Manufactured Homes

There are other ways that may provide advantages over conventional loans to buy a manufactured home.

FHA loans: Just 3.5% down is required and lower credit scores are acceptable.

VA loans: Those with eligible military experience can qualify for a zero-down manufactured home loan.

Chattel Loans: These loans may work for manufactured homes that are not on a permanent foundation or not classified as real estate. They are more like an auto loan than a mortgage.

Personal Loans: Personal loans are not attached to the property. They are loans you get based on your income and credit level. They may be a solution for low-priced manufactured homes that don’t meet traditional loan requirements.

Apply For A Conventional Manufactured Home Loan

Conventional loans are a strong option for manufactured homes, especially if you have stronger credit and at least 5% down.

Apply for your conventional manufactured home loan to see if you can buy one of these properties.

Check Your 2024 Conventional Loan Eligibility

About The Author:

Tim Lucas spent 11 years in the mortgage industry and now leverages that real-world knowledge to give consumers reliable, actionable advice. Tim has been featured in national publications such as Time, U.S. News, MSN, The Mortgage Reports, My Mortgage Insider, and more.

I'm Tim Lucas, and I spent 11 years in the mortgage industry, gaining real-world knowledge and expertise that I now leverage to provide consumers with reliable and actionable advice. My insights have been featured in national publications such as Time, U.S. News, MSN, The Mortgage Reports, My Mortgage Insider, and more. Let's delve into the concepts covered in the article about financing manufactured homes.

Manufactured Home Overview: The article discusses the rising home prices, prompting many to consider manufactured homes as an affordable alternative to site-built homes. It addresses the financing aspect and assures readers that there are various ways to secure a mortgage for manufactured homes, including conventional loans.

Pros and Cons of Manufactured Homes: Pros include affordability, less competition in the market, and modern designs. However, the cons involve the depreciation of the home structure over time, potential land rent costs, and lower demand in the market compared to site-built homes.

Manufactured Home Eligibility Requirements: To be eligible for a conventional loan from Fannie Mae or Freddie Mac, a manufactured home must meet specific criteria. These include being permanently attached to a foundation, eliminating the vehicle title, being built after June 15, 1976, having certain dimensions, and having necessary labels and certifications. Additionally, the borrower must own the land, and the home should be connected to utilities.

Conventional Loan Requirements for Manufactured Homes: Manufactured homes are generally considered riskier by lenders, leading to stricter requirements. For conventional loans on manufactured homes, primary residence status is required (second homes and investment properties are allowed with larger down payments), a minimum down payment of 5%, a credit score of at least 620, mortgage insurance for down payments below 20%, and specific mortgage terms (30-year fixed rate or 7- or 10-year adjustable-rate mortgages).

MH Advantage Program: MH Advantage is a special program by Fannie Mae and Freddie Mac that offers financing similar to site-built homes. This program waives standard manufactured home interest rate increases and allows a lower down payment of 3% instead of 5%. The home must meet specific standards, and the MH Advantage label is crucial for eligibility.

HUD Data Plate and HUD Certification Label: These are essential documents for manufactured home loan approval. The HUD data plate is a paper document detailing manufacturer information, and the HUD certification label is a metal tag on the exterior verifying that the home was built to HUD standards. Both are required for the loan approval, and their absence may be compensated by a letter from the Institute for Building Technology and Safety (IBTS).

Conventional Loan Alternatives: The article suggests alternatives to conventional loans, such as FHA loans with a 3.5% down payment and lower credit score requirements, VA loans for eligible military personnel with a zero-down option, chattel loans for homes not on a permanent foundation, and personal loans that are not attached to the property.

Applying for a Conventional Manufactured Home Loan: Concluding the article, it encourages readers to explore conventional loans, especially if they have strong credit and a minimum 5% down payment. It emphasizes the importance of checking eligibility and applying for the loan.

In summary, the article comprehensively covers the various aspects of financing manufactured homes, addressing eligibility requirements, pros and cons, conventional loan specifics, alternative financing options, and a special program like MH Advantage.

Manufactured Home Conventional Loan Guidelines Explained (2024)


What is the conventional max LTV for manufactured housing? ›

Loan-to-value limits: The maximum LTV is generally 95 percent; how- ever, refer to the Seller/Servicer Guide Section H33. 3(e) for the latest details as certain exceptions apply; for example, 5 percent is subtracted from LTV limit if using secondary financing. Adjustable-rate mortgages: 7/1 and 10/1 ARMs are allowed.

Why is it harder to get a loan for a manufactured home? ›

Since the structure isn't always “attached” to the land they're on, mobile or manufactured homes aren't considered eligible by many lenders for most types of mortgages.

What is considered a permanent foundation for a manufactured home? ›

Permanent foundations include basem*nt, crawl space, and slab with block skirting foundations. Non-permanent foundations, on the other hand, can be detached from your home. However, if you choose a non-permanent foundation, you may not be able to receive real estate loans or financing.

What is a method for financing manufactured homes? ›

Yes, many banks and credit unions finance mobile homes on land. These are usually considered real property loans. Some government-backed loan programs, like FHA Title II loans and certain VA loans, also allow for the financing of mobile homes along with the land they sit on.

Which fact would make a manufactured home ineligible for a Fannie Mae loan? ›

A mortgage secured by a manufactured home located on a leasehold estate is not eligible for sale to Fannie Mae. The home cannot have been previously perma- nently installed at another site.

What are the requirements for a manufactured home in Fannie Mae? ›

Fannie Mae defines a “manufactured home” as a dwelling of at least 400 square feet and at least 12 feet wide, constructed to the “HUD Code” for manufactured housing, that is built on a permanent chassis, installed on a permanent foundation system, and titled as real estate.

What is the oldest manufactured home that can be financed? ›

(Note that the FHA does not issue mortgages on mobile homes built before June 15, 1976.)

What is the downside of a manufactured home? ›

A disadvantage of buying a mobile home is that its value will depreciate quickly. Like a new car, once a mobile home leaves the factory, it quickly drops in value. Stick-built homes, on the other hand, normally appreciate in value over time because the stick-built home owner almost always owns the underlying land.

Why don't banks like manufactured homes? ›

Many lenders will not approve a conventional loan for a mobile home because they are not considered “real property.” However, homes that are attached to a permanent foundation could qualify.

What is the best foundation for a manufactured home? ›

A concrete foundation is the most economical option, and can easily be adapted to varying soil conditions. In addition, concrete can be finished to match the aesthetics of your home, making it a great option if you're looking to add some curb appeal.

What is the cheapest permanent foundation for a mobile home? ›

Slab foundations are one of the most affordable foundation options for manufactured homes. Slab foundations are typically quick to construct. You can use slab foundations in seismic areas. You can use slab foundations in flood hazard areas.

Is a cement slab considered a permanent foundation? ›

Non-Permanent Foundations

Slab Foundations - This type of foundation comprises of a single slab of poured concrete. The home will rest on the slab using piers.

What is conventional financing? ›

A conventional loan is any mortgage loan that is not insured or guaranteed by the government (such as under Federal Housing Administration, Department of Veterans Affairs, or Department of Agriculture loan programs). Conventional loans can be conforming or non-conforming.

Which type of loan product can be used to finance the purchase of a manufactured home on leased land? ›

Chattel mortgages finance mobile or manufactured homes on leased land. Borrowers cannot opt for a traditional mortgage since the land does not belong to the homeowner. Instead, the mobile or manufactured home is considered “personal movable property” and security for a chattel mortgage.

What is a chattel mortgage loan? ›

A chattel mortgage is a loan for a manufactured home or other movable piece of personal property, such as machinery or a vehicle. The movable property, called “chattel,” also acts as collateral for the loan.

What is the maximum LTV on a conventional loan? ›

Conventional 97 loan: 97% LTV. Fannie Mae HomeReady: 97% LTV. Freddie Mac Home Possible: 97% LTV. FHA loan: 96.5% LTV.

What is the max conventional cash-out LTV? ›

The LTV limit (known as the loan-to-value ratio limit) for a single-family property is 80%. That means you need to keep a minimum of 20% equity in your home when you do a cash-out refinance.

What is the maximum LTV for a residential mortgage? ›

What are the maximum and minimum Loan to Value mortgages? Generally, mortgage providers require a minimum of either a 5 or 10% deposit and therefore have a maximum LTV of either 90 or 95%. There is no minimum LTV, although some lenders do have minimum loan sizes.

What is the maximum LTV allowed? ›

As a rule of thumb, a good loan-to-value ratio should be no greater than 80%. Anything above 80% is considered to be a high LTV, which means that borrowers may face higher borrowing costs, require private mortgage insurance, or be denied a loan. LTVs above 95% are often considered unacceptable.


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