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  #1  
Old 03/14/04, 06:41 PM
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How to finance a trailer and land

Due to a family illness, I "went through" my savings.

Now, I'm interested in financing a trailer with land. A mortgage broker told me it's very difficult to find a bank to finance a trailer.

In my online reading I discovered that a trailer must be on a slab for financing purposes.

Can anyone enlighten me on this, if so, what is a slab and why is it necessary for mortgage financing?

Are there other options I can look for regarding financing? All creative suggestions appreciated.

Thank you.

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  #2  
Old 03/14/04, 06:46 PM
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A slab is literally a poured slab that the trailer sits on. The other alternative is for it to be set on cinder blocks or pilings (piers?). Basically, lenders have been burned on trailers as collateral so they have additional requirements if they will lend at all.

You might be better off trying to get a loan on a property and then do a seperate deal for the trailer. If you go that route, just make sure you have your water (well) and septic issues/ costs figured out.

Mike

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  #3  
Old 03/14/04, 06:50 PM
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In many counties, trailers on slabs become *real estate* --- essentially no different than a stick built home. I considered putting mine on a slab but, thanks to the slope of my land , it doesn't look like it would work.

Trailers on slabs are much less vulnerable to winds, tornadoes etc and, in some cases, are even safer than stick built homes during bad storms.

The slab also preserves the shape of the home and helps it to last much longer.

And yes, it is true that many financing companies - most at this point, I would imagine -- won't finance trailers unless they are *real estate* (on a slab).

I don't know where you live or what your circumstances are but, if you have any money at all and IF --- and it's a big *if* --- you are very careful and do your research, you can actually find fairly nice trailers for a couple of thousand dollars. It would likely need some work but, if you're very careful and know what you're doing, you can find one that needs just basic work and not a complete overhaul. Esp. these days. TONS of foreclosures going on everywhere. :no:

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  #4  
Old 03/14/04, 07:15 PM
 
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Location: southern CA
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I am getting ready to relocate to southern CA where most of my family now lives. Home prices are out of sight there, so I asked a mortgage loan officer, whose company also does business in CA, about financing a "mobile" on its own land.

He used the phrase "permanent foundation", which I guess could be a slab. Requirements also include that it be a "doublewide", 28 feet, and that it be newer than 1976. For what its worth, I have been mainly searching on the internet for one that is already set up on land.

You might ask a mortgage officer in the area you are looking for their requirements.

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  #5  
Old 03/15/04, 07:10 AM
 
Join Date: Jan 2003
Location: Northern Wisconsin
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Nearly every bank, credit union, & savings/loan in the country has been burned on financing a trailer.

Single wide trailers depreciate horrendously, leaving the borrower upside down in a matter of a few years. The amount owed on the loan FAR exceeds the value of the trailer almost immediately. Throw in a divorce, job loss or illness....and the borrower often walks away from the place......leaving the lender with more red ink.

The book is still being written on double wide trailers as to there resale values.


It goes without saying that trailers (both singles & double wides) are far more secure investments when they are on there own plot of land. This is because land generally appreciates in value.......and a stick built house could usually be placed on the land and the septic system, water delivery system, driveway, electrical service are already in place.

Generally, every township has its own requirements when it comes to trailers. Some require slabs, some require pitch roofs, some absolutely refuse to allow single wides anywhere but existing trailer parks.

I'm convinced that many double wide trailers are just as shabby as the single wides. I'm certain others have the same opinion.

I don't believe trailers should be financed. They are lousy investments.

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  #6  
Old 03/15/04, 10:22 AM
 
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I'm convinced that many double wide trailers are just as shabby as the single wides. I'm certain others have the same opinion.
I'd have to disagree.. We just looked at the construction of today's "double wides" and with a 7/12 pitch roof, 2X6 exterior walls, built to code construction, etc. I would rather have that than what I see my friends getting in stick built.

There are companies that specialize in mobile home financing, complete with land, water septic, driveway, and utility packages. I used to get mailings from them... I'll look around to see if I still have any of them.
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  #7  
Old 03/15/04, 10:49 AM
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Amy's right. These days, govt regulations require trailers be built to a certain standard which, in certain cases, surpasses standards for stick built.

True, certain things are usually still pretty crummy --- cabinets come to mind --- but that keeps costs down.

In the old days, trailers were as bad as it gets, for the mst part. Nowadays, however, they're a reasonable alternative for people who aren't multimillionaires and simply don't want to spend $100K up for decent housing (although some doublewides do approach that cost ).

And when cared for and upgraded, they sure can beat stick built.

But ... you have to beware of the sellers and you can't hold them to their sales pitch promises. The best bet is to find a good used one or repo for a few thou, check it out very carefully and pay cash. And not depend on the sellers or the manufacturers because they generally prove to be very unreliable, at best.

Quote:
Originally Posted by Amy Jo
I'd have to disagree.. We just looked at the construction of today's "double wides" and with a 7/12 pitch roof, 2X6 exterior walls, built to code construction, etc. I would rather have that than what I see my friends getting in stick built.

There are companies that specialize in mobile home financing, complete with land, water septic, driveway, and utility packages. I used to get mailings from them... look around.
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  #8  
Old 03/15/04, 11:02 AM
 
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[QUOTE=countrygrrrl]Amy's right. These days, govt regulations require trailers be built to a certain standard which, in certain cases, surpasses standards for stick built.

True, certain things are usually still pretty crummy --- cabinets come to mind --- but that keeps costs down.

[QUOTE]

We're getting raised panel cabinets, which are very nice. Ours will also have crown moulding, 6 panel doors, raised hearth fireplace, oak mantle and lots of things that we wouldn't be able to afford if we went with stick built.

We're going with Commodore for our manufacturer. We'll have an attic the full length of the home also.

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  #9  
Old 03/15/04, 11:29 AM
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Quote:
and lots of things that we wouldn't be able to afford if we went with stick built.
Mine had the crummy cabinets and doors and doodads (emphasis on had ) --- but going that route also made it very affordable for me. And bit by bit, I'm renovating all that stuff, which made it a reasonable option.

The important things, however, are in great shape --- good plywood floors, great plumbling, all that. This place is truly in much better shape than many stick builts. All in all, I'm happy with the decision.
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  #10  
Old 03/15/04, 11:51 AM
 
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Alternatives

You did not give your location so I have no clue about your specifics

BUT, here in the People's Republic of California people are upgrading their mobile homes, usually in mobile parks. The old mobile homes are frequently simply given away for the cost of transportation to any place in the state and sometimes that is even included. I've seen many come out of the San Francisco Bay area as delivered freebies. Since I have no interest in living in a tin can ever again, I've simply watched somewhat amused.

Try calling mobile home parks and asking for what they have up for sale. If the sellers are desperate they will be glad to see that thing go away. Bear in mind these things are NOT an "investment" and are nothing more than a rapidly depreciating asset. My mum lived in one for six years and the thing decreased in value by 50%. Whatever price they ask, be sure to offer a LoBall price.

Best of luck finding something you can use!

bearkiller

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  #11  
Old 03/15/04, 11:54 AM
 
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Although Amy and Grrl have some good points about value for habitat and quality of construction, Hoop is right when it comes to re-sale and bank value. Trailers are worse than cars as investments. They are almost impossible to sell and they depreciate. The only hope is to put it on a real foundation and camoflage it so it doesn't look like a trailer. Grrrl, you said the following:

"*if* --- you are very careful and do your research, you can actually find fairly nice trailers for a couple of thousand dollars."

The only time a trailer is worth what you paid is if you got it nearly free and you have land to put it on.

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  #12  
Old 03/15/04, 12:31 PM
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If you're simply looking for affordable housing, they're well worth it.

In addition, although the common perception is there is no resale value, that isn't necessarily true. I just saw one across the road go for $34,000, a trailer at least ten years old on only one acre. If the trailer were worth only, say, $2000, that means the property alone is worth $32,000. Which would make me here worth now ... That sale wasn't at all unusual, either.

My own property values have at least doubled (and probably more) in less than two years. The trailer certainly hasn't hurt those values or for that matter, turned out to be a bad investment. One way to look at it, for what I paid for the land AND trailer, I will get back my investment in another year or so just in rent (and very cheap rent at that) saved. Had I bought a house and this amount of land for the price I paid, I wuld have most like had to sink thousands into repairs on the house just to make it habitable.

So ... approached carefully and with a little research, it can turn out very well indeed!

Quote:
Originally Posted by gobug
Although Amy and Grrl have some good points about value for habitat and quality of construction, Hoop is right when it comes to re-sale and bank value. Trailers are worse than cars as investments. They are almost impossible to sell and they depreciate. The only hope is to put it on a real foundation and camoflage it so it doesn't look like a trailer. Grrrl, you said the following:

"*if* --- you are very careful and do your research, you can actually find fairly nice trailers for a couple of thousand dollars."

The only time a trailer is worth what you paid is if you got it nearly free and you have land to put it on.
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  #13  
Old 03/15/04, 02:52 PM
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I financed a trailer and land in 2000 with zero down and then refi'd it last year for 6.5%. *shrug* Talk a mobile home dealer, they will refer you to the mortgage companys that DO homes. Buuuuut doublewides in my area do not seem to depreciate once placed on land, in fact, mine apprasied at 20K more than I paid (land/home) so I didn't even need mortgage insurance, and to jduge by the ads in the paper, I could probably sell for abotu $30K more now.

*shrug* It's all about where you live. I would NOT own a slab home in my area, it's pure sand to China, and building a slab that won't shift would be difficult because the ground just doesn't compact. With a mobile,you can just crawl under it and level it. Most folks out here own doublewides -- a lot of them buy a doublewide then upgrade it, my neighbor's added a block stem wall, is stucco'ing it, and has put a covered patio/carport on it that's as big as the house sqf wise, and it's not a small house! *L* Plus groundset homes are subject to flooding as the ground is almost flat here.

Probably depends on where you live. Land values out here are only going up.

Structurally, my doublewide is great. 2X6 walls, ac bill in the summer was less than a site-built home of the same size I lived in before. Cabinets aren't bad. Fixtures suck, I've had two light fixtures short out, and I've been slowly replacing every faucet in the place and I had to rebuild he toilets at one year.

Leva

Quote:
Originally Posted by countrygrrrl
If you're simply looking for affordable housing, they're well worth it.

In addition, although the common perception is there is no resale value, that isn't necessarily true. I just saw one across the road go for $34,000, a trailer at least ten years old on only one acre. If the trailer were worth only, say, $2000, that means the property alone is worth $32,000. Which would make me here worth now ... That sale wasn't at all unusual, either.

My own property values have at least doubled (and probably more) in less than two years. The trailer certainly hasn't hurt those values or for that matter, turned out to be a bad investment. One way to look at it, for what I paid for the land AND trailer, I will get back my investment in another year or so just in rent (and very cheap rent at that) saved. Had I bought a house and this amount of land for the price I paid, I wuld have most like had to sink thousands into repairs on the house just to make it habitable.

So ... approached carefully and with a little research, it can turn out very well indeed!
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  #14  
Old 03/15/04, 03:10 PM
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In general, mobile homes will depreciate more rapidly than a stick-built house. Someone said in a "few years you will be upside down". Not necessarily; usually once it's wheeled off the sales lot the buyer is upside down. The value of your mobile will often depend on what's around you, and what the "highest and best use" of the land is. A mobile home offers no value as a part of the real estate if the highest and best use is for a million dollar home, except for the amount that someone will pay you so that they can haul it off. If you are in an area of other mobiles, your MH will hold it's value a little better. In theory, even stick-built homes lose their value over time (usually). Depreciation, dated building techniques, etc., all come into play. It is typically the land values that make homes appreciate, plus the increasing cost of building a replacement.

What I would do is what someone else has suggested. Find someone willing to finance the land, then get dealer financing or pay cash for a used mobile. If financed as a package, traditional banks usually do require that it's permanently attached to a slab foundation. Or they will make a loan based on land value alone. Big dealers have land/home packages readily available. But be ready to pay through the nose.

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Old 03/15/04, 03:30 PM
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In the area where I live, the MH dealers advertise that if you have land you can get a MH no money down. I guess they refinance into one making the land your colleratal. Th double wides we have here are quite nice , 2x6 construction, thermo windows, fireplaces, security systems etc. One we looked at came with a built in TV. Better than my stick built house I have now. They can get quite expensive, tho---best bet on buying one-just like buying a new model year vehicle-buy them a couple years old to give them time to work out all the bugs.

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Old 03/15/04, 04:08 PM
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I don't know. Ultimately, I think it all depends on what your *real* goals are. My goal was simply to acquire a place which was entirely, completely and absolutely mine --- no mortgages or financing or rent payments, no co-tenancy or co-owner, none of it.

Cash. Flat out cash. So when I found this place, I grabbed it. The landscape is gorgeous, the surrounding community wonderful and the price better than right.

That the value of the property has been shooting straight up has been a pleasant (abeit a bit scary ) surprise, because I didn't buy this as an investment property. I bought it so that I would always be assured of having a place which was mine, legal and clear. I plan to be here when I'm 90 --- they'll have to carry me out flat dead on a stretcher!!

In any case, i guess my point is, if you're careful and you're wise about it, mobiles can be perfect. It's turned out that way for me. I'm very pleased.

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Old 03/15/04, 07:23 PM
 
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...............One other relevant issue to be considered when purchasing property for me atleast, .........My current home in Texas is completely paid for but the county is being bought up and people with children are moving in so fast that the schools are constantly having to build new structures. And, the taxes are being raised to pay for the schools. Now, I live 10 miles north of town and it is just going crazy. I'm going to sell this place and when I move I'm going to move to a state where property is not so inviting for developers. This must be an issue for just about everybody that wants to hold onto their money. Anybody got any suggestions????.........fordy...

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Old 03/15/04, 09:31 PM
 
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You would be far better off having a stick built home than a MH. Washing windows and DH building the greenhouse today we were sorry we ever bought this trailer. The workmanship is awful; service from dealer is bad; can't go on in the amount of space we have. Too many problems to list and it makes us ill to think that we ever bought this thing instead of building.

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Old 03/15/04, 09:51 PM
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Too me, the best use of a trailer is as extra living space for guests who need their own space (like they brought their dogs with them), not as a primary residence necessarily.

Some of the better mobile home parks have CC&Rs that require you to upgrade to a newer mobile home after so many years--have to keep up their image.... And a lot of places pretty much ban pre-1976 vintage trailers, as others have mentioned.

I agree that resale value is bad, unless you are just on a FANTASTIC piece of property--and a smart buyer will make your removal of the home part of the deal.

And, fwiw, the manufactureds/prefabs that strongly resemble double-wides have the same problem. They can make prefabs that look like conventional homes from the outside, but by the time you pay for all the extras, you may as well have a stick-built.

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  #20  
Old 03/16/04, 08:07 AM
 
Join Date: Aug 2003
Location: Texas
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I cant afford to build... but I could afford a mobile... and we did our homework...

Here in Texas, we went to Palm Harbor Homes, they have some of the best built Mobiles around, and they will help finanace your land...

We SHOULD be signing the papers this week for 12.5 acres and a 1700 sq ft mobile... with the ability of paying it off in 15 yrs..

Yes we are putting the home on a slab.. that way we could get a FHA loan... and the fianance company is also financing the driveway and septic... we all ready have the well and electric in..

Do you homework.. and dont settle for anything.. We waited.. and got exactly what we wanted.

Lynn in Texas

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