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Updated about 1 year ago on . Most recent reply

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Lisa Perry
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Question about financing a home we inherited

Lisa Perry
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Hello.  We inherited a home from my dad and we're not sure if we're going to flip it ourselves or sell it as is.  It's a site built home and not in great condition.  The issue is that he has 2 old mobile homes on the property.  We heard that a bank will not give a mortgage to someone to buy it because of the mobile homes.  Is this true?  Why would that be?  Seems like it costs a lot to move them.  Thanks!

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You're right to be a little concerned about the mobile homes on your inherited property. While it's true that having mobile homes on the property can make it difficult to get a traditional mortgage for buyers, there are still ways to sell it, and understanding the reasons behind the challenge can help you make the best decision.

Here's why banks might be hesitant to finance a property with mobile homes:

  • Mobile homes are considered personal property, not real estate. This means they're not permanently attached to the land like a site-built home, making the overall value of the property less predictable for lenders.
  • Mobile homes can depreciate in value over time, unlike site-built homes, which can appreciate. This can make lenders nervous about the long-term value of the property as collateral for a loan.
  • Moving mobile homes can be expensive and complicated, and there's no guarantee that a buyer will be willing or able to do so. This adds another layer of uncertainty for lenders.

However, there are still options for selling your property, even with the mobile homes:

  • Sell the property as-is: This will likely limit your buyer pool to those who are willing to pay cash or who have alternative financing options. You can highlight the potential of the property and the value of the land in your listing to attract interested buyers.
  • Remove the mobile homes before selling: This can be costly, but it will make the property more appealing to a wider range of buyers and potentially increase your asking price. Be sure to factor in the removal costs when deciding whether this option is right for you.
  • Offer seller financing: If you're willing to take on some risk, you could offer to finance the purchase yourself. This could be a good option for buyers who are struggling to get a traditional mortgage but are still interested in the property.

Obviously, the best decision for you will depend on your individual circumstances and goals. 

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