To determine who refinances mobile homes we must first learn what refinancing is. Simply put, refinancing is essentially replacing an existing debt with a different debt that operates under different terms than your previously existing debt.
Essentially your new lender pays off your old debt and gives you a new agreement to pay off, hopefully with lower interest rates.
Mobile homes come in three different sizes, a single wide mobile home, a double wide mobile home and finally a triple wide mobile home. A triple being the biggest and a single being the smallest.
These vary in prices which of course is determined by the size of mobile home that you are requesting but what can really impact the price is the customizable features that you apply to the home, that can be anything from the insulation you want to maybe what decor you want on the walls.
The first thing you need to do when purchasing a mobile home is determine what mobile home is in your price range and then afterwards work out what features you feel that your mobile home needs to be a comfortable living space for you.
Once you have done this you can start to look into financing options to help pay off your mobile home.
Financed Loans
So your next step is what refinancing package that best fits your financial situation to determine this from the lenders perspective is your yearly income, your credit score and any assets that you currently have in your name, obviously speaking your credit score being a positive one will determine the type of interest rates you are offered with your package.
Luckily you are spoilt for choice on how many companies offer financing for your mobile home needs.
Conventional loans sponsored by Fannie Mae or Freddie Mac. Conventional loans are recommended for those with good credit scores and low debt to income ratios.
An added positive for these types of loans is that if you are in possession of 20% equity in your home then you don’t actually need mortgage insurance which is what repay the lender if you default on your payments.
Another form of loan is a regular FHA loan, the FHA is the federal housing administration, the loans give the person who is lending the money flexibility with low credit scores and a high debt ratio.
FHA Title 1 loans allow you to borrow up to $7,000 for your mobile home, these loans are mainly for people who are currently happy with their mortgage plan but would like extra money for the general improvements to the home they want to make.
Another form of loan is VA loans, the loans are specific to veterans who would like to borrow money or for the spouses of those who have passed. The only issue with these loans is that the maximum time frame is 25 years for refinancing the home and land package.
USDA loans are the best option if you are of low income. But unfortunately you can’t cash out with any more equity with one of these types of loans.
The differences in the guidelines for refinancing mobile homes with a conventional loan rather than a government back loan is significant and should be researched extensively to fit what is best for you and your income, all of these are determined on the same principles though, what your income is and how good is your credit score is. Once you have determined what suits you best you are ready to apply for your refinancing package.
Income And Credit Scores
For a simpler explanation of what you need to take into account when refinancing your home is your income and credit score.
Your income determines at what rate you can pay back the money you have loaned from a specific company. If you are of a high income then you can expect that the loan you will receive will be of a low interest rate, which is basically the money you pay on top of the amount that you have borrowed. If you are of a low income you are more likely to receive higher interest rates being offered to you.
Your credit score will also have an impact on what you can loan too, a good credit score will often mean a good loan being offered. A bad credit score will normally mean a bad loan being offered.
Your credit score is affected by how reliable you are seen by the creditor to pay back the money you have loaned, a credit score is basically your entire credit history, it allows creditors to determine the likelihood of you making your payments on time to the relative companies. You should aim to make all of your payments on time to maintain a healthy credit score.
In Summary
There are plenty of companies that offer financing packages for your mobile home, it is important to research what a loan can mean for you. If you are of a high income you may find that you are eligible for many different loans with lower interest rates.
But if you’re of low income with a bad credit score you will find that you are not eligible for many loans and left with only a few to choose from. A USDA loan for example may best benefit somebody who is of low income which you can read above.
If perhaps you are a veteran or a spouse of a veteran you can apply for VA loans which you may find are beneficial to you. These are just two examples of the loans you can apply for when it comes to refinancing your mobile home.
To receive the best offers with the lowest interest rates it is important to maintain a positive credit score making you a reliable person to pay back the money you have loaned from the companies that offer them. Income will also have an impact on the loans you’re eligible for.
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