Should I be looking into Mobile/Manufactured Homes in Boise, ID?

Question

Home are very expensive right now and we can’t qualify for a 500k loan because my husband just started a business and they need 2 years worth of income history. With that being said, we have 40k right now and we’re losing because of inflation. Would it be smart to purchase a manufactured home so that we have our money somewhere and the market looks like it’s going up? We’re currently renting and it’s $815 a month, for that we could definitely get a lower payment with a mobile home too. Thoughts?

Randall Alan · Answer

Mobile homes function a bit like cars, in that they are a depreciating asset.  They are technically not real estate.  The land they sit on is real estate... but the mobile home is no different than buying a car off the lot... as it ages, it depreciates.  So my suggestion would be to NOT buy a mobile home if you are looking for appreciation.

You could do one of several things... you could buy a cheap investment property and rent it out.  You usually have to put about 20% down a property... so $40,000 could get you upwards of a $200,000 house - though often the bank is looking for a certain amount of reserves, so you may not max out at the top number for the price of the house you qualify for.  There are several paths there. If you are having income challenges financing residentially, you could try a commercial bank loan.  That may sound strange, but commercial loans are judged by how much money the asset brings in, not by how much YOU make.  Yes, they still look at you as a person, but the metrics are different.  They also don't lend on quite as good of terms as residential... loans are amortized over a shorter period of time (usually around 25 years, versus 30), and often the interest rate resets after 5 years... but, with that said, you may have more luck going that route if you can't find a residential loan.

The other things I would say is to shop your residential loan options.  All banks ARE NOT alike.  Usually big banks have less options than smaller local banks from my experience.  I would look for an independent mortgage broker than represents a lot of different lenders.  They will build your loan file and then sell it to another lender.  This gives you 'instant' access to a lot of different lenders at once.  It's no different than buying a car, sitting in the finance office, and the finance guy seeing who you can qualify with based on your situation.

Different banks will have different qualifications you have to meet.  If you can show previous employment that dove-tails with your new job, most would not blink and would call that 2 years of employment history.  They will also look at other assets, your debt ratio, etc.  It's always a "whole package" analysis as they are trying to figure out if you are going to walk on your loan.

I think you should be able to get into a house with the money you have.  Just keep shopping it

All the best!

Randy

Jim Paulson · Answer

I have seen space rent locally from $400 - $700 a month!  Yes, that includes your water, sewer and trash bill, but that is crazy high to waste every month.  I suggest talking to different lenders, preferably a portfolio lender that doesn't resell their loans so that you might get some reprieve from the 2 year employment issue.  Different underwriters interpret that differently so keep that in mind too.  (i.e. some will apply your time in training or in school toward the 2 years).  There are also other private lenders.  Don't forget all the first time home buyer programs here in Idaho that you can take advantage of.

Rachel H. · Answer

@Megan Herrington It may not be a good idea to purchase a mobile home just based on price alone. There are many different factors that may affect your decision. It's best to keep things as things are right not but do your research at the same time. Just like single-family homes and apartment buildings, there are different types of neighborhoods when it comes to mobile homes.

The first thing you should do is research the market. Figure out where you want to live and what amenities you want to be near by. From there, look to see what types of properties are in the area and work that way. When the market is high, it's best to take the time to do your research. Once you pinpoint a neighborhood and property type, then it will make things much more easier as you start to look at opportunities and deals come up over time.

Hope that helps!

Paul Sofia · Answer

Manufactured homes depreciate if they are not deeded with the property.  If they are, they do the same as a site built home, appreciate and depreciate given market conditions.  Title must be surrendered at DMV and that needs to be recorded at the Register of Deeds affixing the home to the property, thus becoming real property.

Should I be looking into Mobile/Manufactured Homes in Boise, ID?

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