Everything You Should Know About Financing A Modular Home
Author:
Kevin GrahamApr 25, 2024
•6-minute read
At every step of the process, building a home is challenging — from securing financing to hiring a builder to picking finishes to closing on the home. The potential hassle may be enough to deter people from buying a brand-new house. However, modular homes can be a happy middle ground between new and accessibility. If you’re considering a modular home, here are the basic things you need to know.
What Is A Modular Home?
Modular homes are customized, prefabricated homes built offsite in a climate-controlled factory. After prefabrication is complete, individual sections (called modules) are then transported to the property. Once the modules arrive at the building site, the house is assembled on a permanent foundation. It’s very likely that you won’t be able to tell the difference between a modular home and a traditional house.
Since they are built on a permanent foundation, modular homes are permanently affixed as real property. That means you can benefit from financing it just as you would a traditional mortgage.
Modular Vs. Manufactured Homes
There are major distinctions between modular homes and manufactured homes. Both are under the umbrella of prefabricated homes, but that’s about the only commonality between the two.
Manufactured homes were widely referred to as mobile homes before 1976. As mobile homes increased in popularity as a viable housing option, the U.S. Department of Housing and Urban Development (HUD) established new regulations via the Federal Manufactured Home Construction and Safety Standards Code. Since the introduction of these codes, mobile homes are referred to as manufactured homes and they are the only federally regulated t