Can You Get an FHA Loan on a Mobile Home?

For many South Carolina residents, mobile homes represent an affordable pathway to homeownership. If you’re considering purchasing a mobile home but are concerned about financing options, you may be wondering whether Federal Housing Administration (FHA) loans are available for this type of property. The answer is yes, with certain conditions and requirements.

Understanding FHA Loans for Mobile Homes

FHA loans are government-backed mortgages designed to help borrowers with lower credit scores and smaller down payments to purchase homes. These loans are particularly popular among first-time homebuyers and those with limited financial resources, making them a natural consideration for mobile home purchases.

The FHA doesn’t directly lend money; instead, it insures loans made by FHA-approved South Carolina mortgage lenders. This insurance reduces the lender’s risk, enabling them to offer more favorable terms to borrowers who might not qualify for conventional financing.

FHA Mobile Home Loan Requirements in South Carolina

When applying for an FHA loan on a mobile home in South Carolina, several specific requirements must be met:

1. Foundation Requirements

The mobile home must be:

• Permanently affixed to a foundation
• Classified as real property (not personal property)
• Built after June 15, 1976, and comply with HUD’s Manufactured Home Construction and Safety Standards

This means the mobile home cannot be on wheels or have a hitch, axles, or wheels. It must be permanently secured to a foundation that meets FHA standards.

2. Property Classifications

The FHA recognizes three types of manufactured housing:

• Manufactured homes: Factory-built entire homes transported to the site
• Modular homes: Homes built in sections at a factory, then assembled on-site
• Mobile homes: Technically, this term refers to homes built before June 15, 1976, which generally don’t qualify for FHA loans

Most modern “mobile homes” are actually manufactured homes, which do qualify for FHA financing if they meet all requirements.

3. Land Ownership

For an FHA loan in South Carolina, you must purchase both the mobile home and the land it sits on. FHA loans are not available for mobile homes in rental parks or on leased land.

4. Loan Terms and Limits

FHA Title II loans for manufactured homes offer:

• For single-wide manufactured homes: Maximum term of 15 years
• For double-wide manufactured homes: Maximum term of 20 years
• For multisection manufactured homes and lot: Maximum term of 25 years

Loan limits vary by county in South Carolina, so it’s important to check current limits for your specific area.

Benefits of Using FHA Loans for Mobile Homes in South Carolina

1. Lower Down Payment Requirements

One of the most significant advantages of FHA loans is the low down payment requirement—as little as 3.5% for borrowers with a credit score of 580 or higher. For those with credit scores between 500-579, a 10% down payment is required.

2. More Flexible Credit Requirements

FHA loans typically have more lenient credit requirements than conventional loans:

• Minimum credit score of 500 (though most lenders prefer 580+)
• Less stringent debt-to-income ratio requirements
• More flexible approach to credit history issues

3. Competitive Interest Rates

Because FHA loans are government-backed, they often offer competitive interest rates compared to other financing options for manufactured homes.

4. Lower Closing Costs

In some cases, FHA loans allow sellers to contribute up to 6% of the purchase price toward the buyer’s closing costs, which can significantly reduce out-of-pocket expenses.

The Mortgage Refinance Option for Existing Mobile Home Owners

If you already own a manufactured home in South Carolina and are looking to take advantage of lower interest rates or tap into equity, mortgage refinance options are available.

The FHA offers several refinancing programs:

1. FHA Rate and Term Refinance

This option allows you to refinance your existing mortgage to obtain a better interest rate or loan term. Requirements include:

• The mobile home must meet all FHA standards
• The home must be your primary residence
• You must have made on-time mortgage payments for the past 12 months

2. FHA Cash-Out Refinance

This program enables you to refinance your existing mortgage and take out additional cash from your home’s equity. Requirements include:

• Maximum loan-to-value ratio of 80%
• Occupancy as your primary residence for at least 12 months
• On-time mortgage payments for the past 12 months

3. FHA Streamline Refinance

This simplified refinancing option requires minimal documentation and no appraisal:

• Your existing mortgage must be FHA-insured
• You must be current on your mortgage payments
• The refinancing must provide a “net tangible benefit” (typically a lower interest rate)

Challenges and Considerations

While FHA loans provide accessible financing options for manufactured homes, some challenges remain:

1. Finding Approved Lenders

Not all South Carolina mortgage lenders offer FHA loans for manufactured homes. You’ll need to work with a mortgage broker experienced in mobile home financing.

2. Meeting Property Standards

Your manufactured home must meet HUD’s Manufactured Home Construction and Safety Standards, displaying a red HUD certification label. Additionally, the home must comply with local building codes and zoning regulations.

3. Mortgage Insurance Premiums

FHA loans require both an upfront mortgage insurance premium (UFMIP) and annual mortgage insurance premiums (MIP). These additional costs should be factored into your budget.

4. Maximum Loan Amounts

FHA loan limits vary by county in South Carolina and may be lower for manufactured homes than for traditional homes.

Secure Affordable Financing for Your Mobile Home Today

Yes, you can get an FHA loan for a mobile home in South Carolina, provided it meets specific requirements regarding foundation, classification, and land ownership. These loans offer advantages, including lower down payments, more flexible credit requirements, and competitive interest rates.

For South Carolina residents looking to purchase a manufactured home or refinance an existing one, working with experienced South Carolina mortgage brokers who specialize in FHA loans is crucial. These professionals can guide you through the application process and help you navigate the specific requirements for manufactured housing.

If you’re considering an FHA loan for a mobile home purchase or refinance in South Carolina, contact us at 843-314-4101 for personalized guidance on your financing options. Our team of experts specializes in FHA loans in South Carolina and can help you determine the best path forward for your manufactured home financing needs.