VA Manufactured Home Guidelines On VA Home Loans

In this blog, we will discuss and cover VA manufactured home guidelines on VA loans. Gustan Cho Associates have spent a lot of time tailoring loan programs to our nation’s veterans. A large percentage of our borrowers at Gustan Cho Associates are VA loans. We have a national five-star reputation due to the fact we have no lender overlays on VA loans. There are no minimum credit score requirements on VA loans. Borrowers do not have to meet a maximum debt to income ratio cap on AUS-approved VA loan findings. There is no maximum loan limit on VA loans.

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VA Lenders with No Lender Overlays

A VA mortgage loan is an amazing tool to help our we help our veterans purchase a home and provide for their families. Many of our clients are veterans who qualify and get approved for VA loans with no lender overlays as long as they have been timely on all of their payments for the past 12 months. So we do all we can to participate in programs that will help further their financial success for our veterans.

Specialty VA Loan Programs at Gustan Cho Associates

Gustan Cho Associates provide VA RENOVATION LOAN just like HUD’s FHA 203k loans. We also participate in the Mortgage For Heroes program. Gustan Cho Associates offer aggressive VA MANUAL UNDERWRITING. We try to do all we can to help those who have served our country. Without them, we would not have the freedoms many take for granted on a daily basis. Over this past summer, we have had many veterans calling with questions about purchasing manufactured properties. In this blog, we will detail how to utilize a VA loan with Gustan Cho Associates to purchase a manufactured property, what a manufactured home means, and things to consider when buying a manufactured home.

What Are Manufactured Homes

First, it is important to understand what a manufactured property is. The Department of Veteran Affairs defines a manufactured home as a structure that is transportable in one or more sections. A manufactured home is designed and constructed to the Federal Manufactured Construction and Safety Standards.

Using VA Loans To Purchase Manufactured Homes

Using a VA mortgage is one of the best programs to use to buy a manufactured home. It must be clearly labeled with the certification that it is built to these standards. Any manufactured home built to be specific standards is a complete dwelling designed for year-round living. That is important because you can only use a VA loan to purchase your primary residence.

Manufactured Home Requirements on VA Loans

The home itself is constructed in a factory on a permanent steel frame and later transported to the site where the axles are then removed and the home itself is attached to a permanent foundation. Being attached to a permanent foundation is critical for buying the property. If the property itself is not attached to a permanent foundation, we cannot offer a mortgage loan on that property. Rules of thumb, if the house can easily be moved, do you need a personal loan, not a mortgage.

VA Manufactured Home Guidelines On Property Requirements

VA Manufactured Home Guidelines On Property Requirements:

Now that we understand what a manufactured property is, let’s go into some specifics on the properties themselves
Back on June 15, 1976, HUD enacted the new building standards for manufactured properties
In order to be eligible 4 mortgage financing manufactured property must be constructed after June 15th, 1976
The property must be considered “real estate” and not on leased land (you must own the land below the manufactured home)
The home itself must be attached permanently to a foundation up to FHA guidelines
If the home itself passes the checkpoints just listed, a HUD certification label often referred to as a HUD tag will be affixed to the exterior

This tag will be a company with a HUD data plate which will help the appraiser confirm the manufacturer’s name model name, year manufactured, and serial number to the specific property.

Using VA Loan To Purchase A Manufactured Home

How to use your VA loan to buy a manufactured property:

Utilizing your VA benefits to buy a manufactured property is very easy with Gustan Cho Associates
The beginning of the process is no different than buying a stick-built property

Below are the steps to apply for a VA mortgage with Gustan Cho Associates:

Step 1:

Call Mike Gracz on 630-659-7644. After a brief one-on-one consultation, either Mike or one of the other loan officers at Gustan Cho Associates will help you

Step 2: Send in the following documentation:

Last 60 Days Bank Statements – to source money for escrows
Last 30 Days Pay Stubs
Last Two Years W2’S
Last Two Years Tax Returns
Driver’s License
Certificate of Eligibility
(additional documents may be needed)

Step 3:

Obtain Pre-Approval Letter
Depending on your qualifications, you may need to work on credit or assets before obtaining the pre-approval letter
If you do not qualify today, our team will put you on a fully customized financial plan to qualify for your VA loan as soon as possible
Assuming we were able to get you pre-approved, you will then be able to go out and shop for a home

Step 4:

Submit an offer to purchase a home
Once you and your family select the property you would like to buy and your offer is accepted, you will send the contract to your loan officer

Step 5:

Loan Disclosure package
The support staff at Lone cabin will send you all of your loan disclosures
This is when the process officially starts
For more information on the loan process, please see our MORTGAGE PROCESS TIMELINE BLOG

Step 6:

Appraisal, Engineering Certificate, Underwriting
Congratulations on making it to this Milestone
Now that the disclosure package is signed, it is time to order your appraisal and Engineering certificate for the manufactured property
While those processes are being completed, your loan will be submitted to the underwriter
Once the underwriter completes the initial approval, you will send in remaining documentation to achieve your clear to close
The engineering certificate is part of buying a manufactured property
This stuff is not part of buying a stick-built home

Step 7:

Receive official clear to close and set up your closing

Step 8:

Close at the title company and sign the loan documents. GET KEYS!!

Now it is time to celebrate. You are officially a homeowner!!!

What Is An Engineer’s Certification

What is an engineer’s certification? As mentioned above, this Engineer’s Certificate is only part of the process when purchasing a manufactured property. The lender will require an engineer certification on foundation compliance. A professional and licensed structural engineer must certify with a stamped letter that the foundation of the manufactured property meets or exceeds the HUD guidelines. It needs to abide by the rules and requirements that are specified in “The Permanent Foundation Guidelines for Manufactured Homes (PFGMH), put in place in September 1996”.

Other Rules And Regulations During Manufactured Home Buying Process

The lender must be provided verbiage that there is no visual indication that the manufactured home has been previously installed or occupied at another site or location. This verbiage must be on the engineer’s certificate of compliance or the appraisal. If there are improvements to the structure such as in addition, the structural engineer must provide verbiage that the improvements meet the HUD guidelines specified in the PFGMH. The cost of this engineering certification is the responsibility of the veteran. The lender must accurately disclose this fee to the borrower on the initial application. In some instances, a previous engineer certificate can be used as long as it is dated within five years of buying the manufactured property. Restrictions apply.

Drawbacks In Purchasing Manufactured Homes

Drawbacks to buying a manufactured home. Many Americans want to purchase manufactured homes because of the price point and location. Usually, a manufactured property is cheaper than a stick-built home. They are also on larger plots of land. The privacy and solitude outside of major cities is a major draw for manufactured homes. Some things to consider if you choose a manufactured property. Your insurance cost will be higher than a stick-built property. This is due to the higher chance of damage with extreme weather. Contact your insurance agent for more about your additional premiums.

VA Manufactured Home Guidelines: Upfront Costs With Buying A Manufactured Home with VA Loans

The Upfront costs associated with buying a manufactured home are also higher than a stick-built property. The main difference is the engineer structure report. The dollar amount for an Engineer’s Structure Report can vary quite a bit depending on the size of the property and location. If for any reason the property does not pass an appraisal or Structural Engineering report, the borrower loses all funds spent on those inspections. Adding a small amount of financial risk in the buying process.

Other Lending Requirements And VA Mortgage Guidelines

It is no secret that a VA mortgage loan is usually the best loan product available to our veterans. They do not require a down payment, do you not have monthly mortgage insurance, and usually have lower interest rates compared to conventional mortgages. This creates a trifecta opening homeownership to our brave veterans.

Understanding The Basic VA Agency Mortgage Guidelines

Many veterans reach out to Gustan Cho Associates for confusion on VA guidelines. This is due to the fact that most lenders have lender overlays on their VA mortgage products. Many lenders will tell you to need a 620 credit score to apply for a VA loan. However, that is an overlay, not a guideline. The VA guideline does not have a minimum credit score requirement.

VA Manufactured Home Guidelines and How Mortgage Underwriters Analyze Borrowers of Manufactured Homes

To obtain a VA loan, underwriters are more interested in your payment history than your actual credit score. If you have the past 12 months with all on-time payments and no non-medical collections, chances are we can get you approved You will need to have a little money in the bank for closing costs and reserves. The seller can also contribute up to 4% of the purchase price to help you pay for your closing cost.

VA Manufactured Home Guidelines Versus Lender Overlays

Not all VA lenders have the same mortgage guidelines on VA loans. Gustan Cho Associates is a mortgage company licensed in 48 states with no lender overlays on VA loans. For more information on the VA loan products that we offer, please call 630-659-7644. You may also email Mike Gracz at mgracz@gustancho.com.

Qualifying For VA Manufactured Home Loans With A Lender With No Overlays On VA Loans

Contact Gustan Cho Associates for more details on buying a manufactured property with your VA benefits. We are available 7 days a week and even on holidays. Buying a home is an exciting time for you and your family. We would love to help you through the process. We know you will love working with Gustan Cho Associates!