Posted on February 22, 2025 by - Buying a Home, Mortgage Tips

Did you know that over 22 million Americans live in manufactured homes? It’s one of the most affordable ways to own a home however financing can be tricky. That’s where FHA loans for manufactured homes come in! FHA loans are backed by the Federal Housing Administration. This makes them a great option for homebuyers looking for low down payments and flexible credit requirements.

Use this home loan resource to break down everything you need to know about FHA loans for manufactured homes in 2025—eligibility, pros and cons, financing options, step-by-step application process, and more. If you still have questions, reach out to one of our licensed home loan experts!

What are FHA Loans for Manufactured Homes?

FHA loans for manufactured homes are government-backed mortgages insured by the Federal Housing Administration (FHA), designed to help buyers finance the purchase of manufactured homes. FHA loans offer easier qualification criteria compared to conventional loans, making them an attractive option for potential homeowners who may have lower credit scores or smaller down payments.

Unlike conventional home loans, which typically require higher credit scores and more stringent financial qualifications, FHA loans offer more lenient terms. They also come with competitive interest rates and lower down payment requirements, often as low as 3.5% for borrowers with credit scores of at least 580.

Many buyers choose FHA loans because they provide an affordable way to finance a manufactured home while benefiting from government-backed security, which reassures lenders and increases loan accessibility.

FHA Loan Requirements for Manufactured Homes

General FHA Loan Guidelines

To qualify for an FHA loan for a manufactured home, borrowers must meet specific financial and credit criteria:

  • Credit Score Requirements: Typically, a minimum credit score of 580 is required for a 3.5% down payment, while those with scores between 500-579 may qualify with a 10% down payment.
  • Debt-to-Income (DTI) Ratio: Most FHA loans require a DTI ratio of no more than 43%, though some lenders may allow higher ratios under specific circumstances.
  • FHA-Approved Lender: An FHA loan must be obtained through an FHA-approved lender who follows the program’s lending standards.

Property Eligibility for FHA Loans

Beyond borrower qualifications, the manufactured home itself must meet FHA regulations to be eligible for financing:

  • Permanent Foundation: The home must be permanently affixed to a foundation and cannot be located on rented land unless financed through an FHA Title I Loan.
  • HUD Code Compliance: The home must meet U.S. Department of Housing and Urban Development (HUD) construction and safety codes.
  • Manufacture Date: The home must have been built on or after June 15, 1976, when federal standards for manufactured housing were established.
  • Size and Installation Standards: There are minimum size and installation quality requirements to ensure habitability and durability.

Types of FHA Loans for Manufactured Homes

FHA loans for manufactured homes come in different types depending on the borrower’s needs and property circumstances.

Manufactured Homes on Land

FHA loans are available for manufactured homes permanently affixed to real property. Chattel loans are available for manufactured homes in a park or community however FHA loans require that a home be on owned real estate.

  • Requires that the manufactured home be permanently attached to land and classified as real property.
  • Follows standard FHA mortgage terms with competitive interest rates.
  • Has traditional loan limits, meaning borrowers should ensure their home’s price falls within FHA guidelines.

FHA 203(k) Loans for Manufactured Homes

  • Used for repairs and renovations on a manufactured home.
  • Allows buyers to finance both the home purchase and the necessary improvements under one loan.
  • A great option for those purchasing an older manufactured home that needs upgrades.

Pros and Cons of FHA Loans for Manufactured Homes

Benefits

  • Lower Credit Score Requirements: FHA loans are more accessible for borrowers with lower credit scores compared to conventional loans.
  • Low Down Payment Options: Buyers can qualify with as little as 3.5% down.
  • Competitive Interest Rates: Borrowers typically receive favorable rates due to the government backing.
  • Increased Lender Confidence: Since the loan is insured by the FHA, lenders are more willing to approve financing.

Drawbacks

  • Mortgage Insurance Premium (MIP): FHA loans require mortgage insurance, which adds to monthly payments and overall costs.
  • Strict Property Requirements: The home must meet FHA and HUD guidelines, sometimes making it harder to find eligible properties.
  • Loan Limits: FHA-established loan limits may restrict how much a borrower can finance, which can be a challenge in more expensive housing markets.

FHA Loan Application Process for Manufactured Homes

Step 1 – Determine Eligibility for FHA Loans for Manufactured Homes

  • Review your credit score and DTI ratio to ensure they meet FHA loan criteria.
  • Confirm that the manufactured home qualifies according to FHA property standards.

Step 2 – Choose the Right FHA Loan Type

  • Decide whether you need a traditional FHA Loan, or FHA 203(k) loan based on the home and land situation.
  • Consider which loan options align with your financial situation and goals.

Step 3 – Find an FHA-Approved Lender or Mortgage Broker

  • Research FHA-approved lenders who specialize in manufactured home financing.
  • Pick a reputable loan officer that is an expert in manufactured home financing.
  • Ask about loan terms, interest rates, and fees before making a decision.

Step 4 – Gather Essential Documents

Prepare necessary documents for the loan application process:

  • Income Proof: W-2s, recent tax returns, and bank statements.
  • Credit History: Credit reports and payment history.
  • Property Documents: HUD certification, home title records, and installation details.

Step 5 – Submit Your FHA Loan Application

  • Begin with pre-approval to determine how much you can borrow.
  • Submit the final application and wait for the loan approval process, which typically takes several weeks.
  • Once underwriting has cleared your loan for closing you can close on your new home!

    Request Information Now!


    By clicking "Submit Now!", you consent to receive calls and texts at the number you provided, including marketing by autodialer and prerecorded and artificial voice, and email, from Riverbank Finance LLC about your inquiry and other home-related matters, but not as a condition of any purchase; this applies regardless of whether you check, or leave un-checked, any box above. You also agree to our Privacy Policy and Terms of Use regarding the information relating to you. Msg/data rates may apply. This consent applies even if you are on a corporate, state or national Do Not Call list. This no obligation inquiry does not constitute a mortgage application. To apply now or get immediate assistance, call us at 1-800-555-2098.

    Alternatives to FHA Loans for Manufactured Homes

    If an FHA loan isn’t the right fit, other financing options are available:

    • VA Loans: For eligible veterans and active military members, offering zero down payment options.
    • USDA Loans: Available for buyers in rural areas who meet USDA income guidelines.
    • Conventional Loans: Require higher credit scores but may provide better flexibility for down payments and mortgage insurance.
    • Chattel Loans: Specifically for manufactured homes not permanently attached to land, allowing financing of the home separately from the land.

    FAQs About FHA Loans for Manufactured Homes

    Can I buy a mobile home with an FHA loan?

    Yes, but it’s essential to distinguish between mobile homes, manufactured homes, and modular homes. FHA loans apply to manufactured homes built after June 15, 1976, that meet HUD standards. Mobile homes built before this date may not qualify.

    Can I use an FHA loan for a manufactured home on leased land?

    Yes, but only under FHA Title I loans, which allow financing of the home without requiring land ownership. However, lenders may have additional requirements regarding lease terms.

    Are FHA loans available for used manufactured homes?

    Yes, FHA loans can be used for previously owned manufactured homes, as long as the home still meets HUD regulations, has a permanent foundation, and was built after June 15, 1976.

    What is the minimum down payment for an FHA loans for manufactured homes?

    The minimum down payment is 3.5% for borrowers with a credit score of 580 or higher. Borrowers with credit scores between 500-579 may qualify, but they must provide a 10% down payment.

    By understanding FHA loan options for manufactured homes, buyers can take advantage of affordable financing while ensuring their home meets HUD-established quality standards.

    Buying a manufactured home can be a smart and affordable way to secure homeownership. FHA loans offer low credit and down payment requirements, making it easier for many borrowers to qualify. However, understanding the eligibility rules, loan options, and application process is key. If you’re ready to get started, take the next step by getting pre-approved by an FHA-approved lender today. You could be one step closer to owning your dream home!

    Related Posts