The good news about getting a bad credit manufactured home loan is that unlike most other bad credit loans, they are not so hard to get. However, this does not cancel out the need to do all that is in your power to repair your credit. While it is not too hard to get a bad credit loan to buy a mobile home, you do have to be prepared to pay higher interest rates than you would if you had a better credit score.
There are several ways to go about getting a mobile home loan with a poor credit rating. Following are the options available to you, for your consideration:
– Ask the present owner of the manufactured home about renting to own. This is a lease agreement where you pay a certain amount every month but you do not own the mobile home just yet. The advantage of using this method is that it allows you time to clean up your credit, then buy the mobile home at a specified date, after you have gotten your credit ratings up, and thus have more options as far as getting a mobile home loan goes.
– Ask the owner if he or she would be wiling to carry the note on your loan. This note is secured by the manufactured home. In other words, the mobile home is set up as collateral; if you default on your payments, the owner has the option of repossessing the mobile home. This is a good option as mobile homes are not only one of the most inexpensive housing options there are but also one of the most practical. Along with the mobile home purchase, see about negotiating the land rent as well. The land rent is where you are paying for the spot where your mobile home will be parked; it should be very clear on the contract whether you would be paying an additional amount for this or if it is included in the loan.
– If the above mentioned two options do not work out for you, you can also look into getting an ARM (Adjustable mortgage rate) loan. This is not the best option, and you should avoid having to do this, but if all else fails, it is still an option. With adjustable mortgage rates, you will not be paying a set amount of interest on your mobile home loan; the rates will change month by month depending on economic conditions in your area. If you do use this method to get a manufactured home loan, you should work to repair your credit and then refinance the loan.
If you are looking for a bank or institution to give you a bad credit loan to buy a mobile home, you should be very careful about which one you choose. It is usually best to go with larger, well-known lenders than it is to use a company you found on the internet. While there are internet based lending companies that offer good deals even to those with bad credit, it is often hard to find which of these companies are credible and which ones are simply fraudsters interested in your banking information.
No matter what kind of loan you do end up taking, be sure that everything is very clearly spelled out on the contract and signed by both parties. If there is any fine print on the contract, read it very carefully as often the fine print will contain important points that you should be aware of. Make sure that you know exactly what the loan entails and what the exact terms are.
Financing