Frequently Asked Questions
A: Manufactured homes are single-family homes that are constructed entirely in a controlled factory environment. These units are built according to federal Manufactured Home Construction and Safety Standards, which are commonly known as the HUD code.
Q: Why should I buy a Manufactured Home?
A: Manufactured Homes are attractive quality built homes. These homes often exceed the amenities and flexibility offered by other housing options at a much more affordable price.
Some of features of this type of home are:
- Costs less than site-built homes and modular homes.
- Financing terms vary depending on home placement.
- Manufactured Home Zoning requirements.
- Move-in ready in as little as 60 days.
Down Payment: Depending on the age and price of the mobile home and your credit score you will need a down payment of at least 10% to 25% of the selling price, depending on your credit scores, age of the home you are purchasing, and the rating of the park in which the home is or will be located.
A: Good credit scores are essential to buying a mobile home and renting a space in a mobile home park.
Q: What should I consider in purchasing a mobile home?
- Prices: Like in the purchase of regular houses, the prices for mobile homes vary dramatically.
- Age of mobile home is important to consider: Brand new homes qualify for the best interest rate and longest term, providing your credit is up to snuff. When
buying a brand new I recommend you meet with our sales team to design one that will provide you with all the bells and whistles you’ve longed for in a conventional home, but have not been able to afford such luxuries.When purchasing a formerly owned manufactured home, I recommend buying one that best fits your budget. I recommend you get a termite inspection, roof inspection and a health and safety inspection (property inspection) before closing escrow.
- Financing: Typically the interest rate is a bit higher for mobile or modular homes than conventional houses, today between 6.% and 10% depending on ones FICO score and the amount of the down payment. The reason for the interest rates being higher than for conventional housing is because the a mobile or modular home could be moved from its site and there is a possibility the lender would not know about it or be able to recover it in the event of default by the borrower. The length of the loan, called the term, will range between 15 and 20 years unless you’re purchasing a brand new manufactured home, then 30 year loans are available.When you need to finance a mobile home or manufactured home, call me and I will put you in contact with lenders who would be most appropriate for your particular needs By the way, the interest on a mobile home loan is tax deductible, assuming it is your primary residence.
- Closing Costs: You will need additional funds for closing costs, which typically run about $2,000 to $7,000. This includes your escrow fees, title search and state transfer fees, lender fees, signing fees, notary, inspections, insurance, first month’s space rent typically $400 to $1,000. Depending on the park’s policy, you may need to post a security deposit, typically $200 to $1000, which is refundable after one year of residency upon your written request. If the seller doesn’t provide a home warranty, buyers can purchase one at a cost of approximately $315 to $350 for a year.
- Consider the amount of property taxes or license fee: Homes built and first sold prior to July, 1980 usually are on the Department of Housing’s (DOH or HCD) license fee schedule unless the home has been voluntarily converted to the personal property tax rolls. If a home is on the license fee a buyer would pay California state sales tax at the close of escrow and an annual license fee that usually is approximately $200. The exception would be if someone voluntarily converted the home to the county tax rolls. If a home was constructed after July, 1980 to the present it will automatically be placed on the county’s personal property tax roll. The property taxes vary greatly depending on the year the home was built and the price paid for it. Generally newer homes will have property taxes anywhere from $400 per year up. I’ve seen many with property taxes exceeding $1,200 per year. Homes on a county’s tax rolls are exempt from sales tax.
- Qualifying to live in a mobile home park: Even if you pay all cash for a mobile home you will need to have good credit, FICO Scores above 720, and gross income usually three times the monthly rent .Residents of mobile home parks in the San Francisco Bay Area are allowed to have a pet or two under the current state laws. Parks still restrict the number, size, and breed.
- Lot or Space Rent: Typically space rent runs between $410 and $1500 per month and in some areas more. Remember, when you purchase a mobile home the land on which it is located is not included in the sale. That land you rent from the park, which also provides the recreation facilities.In addition to the space rent you will be responsible for your utilities. In some cases the park will pay for your water, while other parks also pay for your trash service. Each park varies.
- Outside Storage: State code has increased the size of an allowable storage shed on a mobile home lot to 120 square feet. However, some parks only allow 100 square foot sheds.
Q: Why do people choose mobile home living in the San Francisco Bay Area?
A: Mobile homes and manufactured homes provide affordable opportunities for people to own their own home.
- Mobile homes and manufactured homes generally are larger in size and cost substantially less than conventional subdivision houses or condominiums.
- Mobile home and manufactured home living in the San Francisco Bay Area is very affordable and enjoyable.
- Mobile home and manufactured home living provide a comfortable life style for empty nesters who sell their conventional homes and purchase mobile homes or manufactured homes. Usually they will have a substantial amount of money left over to supplement their retirement.
- Mobile homes and manufactured home living provide more privacy than apartments or condominiums.
Q: What types of mobile home parks are in the bay area?A: All-age or family parks that cater to residents of any age, and Older persons or senior parks that cater to residents over age 55. Most senior or older person parks allow additional residents to be as young as 18 as long as the primary resident and owner is at least age 55. However, in some parks the additional residents need to be at least age 35 or 45 or 55 depending on the park.
Q. I’m not 55 yet, but I’m close, I’m 53. Will the parks bend the 55 rule?
A. Probably not because the older persons designation is granted by the federal government and enforced by HUD. The Housing for Older Persons Act of 1995 (HOPA)
Q. Where can I find out more information about housing for older persons? A. HOPA Questions and Answers
Q. When is the best time for me to move into a senior park?A. Any time after you turn age 55. Since parks have income requirements it is easier to qualify for residency while you are employed because in most cases your income will be higher than your retirement income. Thus, it is easier to meet the minimum income requirements of three times the space rent.
For information on buying or selling bay area real estate, mobile homes or manufactured homes, please contact Joanne at 510-429-4800 or her cell phone 510-589-4794
