Hey future mobile home owners! So, you’re thinking about getting a loan to help you buy a mobile home but you might be wondering, “Can I really get a loan? What income do I need?” Well, we’re here to break it down. Let’s talk about what you need to qualify for a mobile home loan.
Step 1: Money Talks
First things first, you need to have some money coming in over the long term aka income. This can be money from your job or other places like social security or retirement (401k) or investments (like stocks or bonds). But if you only receive things like workman’s comp or unemployment – these DO NOT count as income because they’re temporary. Same thing applies – if you receive cash only or cash under the table – this can’t be documented so it won’t count as income for loan purposes. Mobile home lenders, by law, have to make sure you have enough permanent and long term money coming in to pay back the loan. They want to be sure you won’t have a hard time making the payments.
Step 2: Show The Money
If you have a job, that’s great! Lenders like to see that you have a steady job. They might ask you for some info about your job, like how long you’ve been working and how much you make and also proof of your income – like most recent pay stubs. Generally – you’ll need to be able to provide at least 30 days of paystubs. You won’t necessarily need to be at your job for 2 years but mobile home lenders will at least ask for your job history for the last 2 years. If you don’t have a job but are receiving things like social security, disability, child support, cash assistance, alimony – still great! These also are considered permanent and long term income. You’ll have to show proof that you receive these and for how long. How much income you’ll need to be prequalified or preapproved depends on several factors including the home price, how much you plan to put down, the minimum debt payments from your credit report, etc. Contact us to get a sense whether you have enough income to be prequalified.
Step 3: Credit Check and Debt
You’ll generally have to have a credit score of at least 550. Lender’s will look at your credit report and credit score and compare it to your income. Everyone is different in terms of how much money they earn or receive, their score, their debts (monies they owe), etc. So a mobile home lender will look at how much you’re getting in, how much money you have going out (to pay your debts), how much your loan payment will be with them and lot rent you pay to the community – to see if you receive enough money to cover it all. This formula is called your debt to income ratio. Usually – the lender will do the math to make sure your DTI is no more than 50%. In other words, no more than 50% of your income would be going to cover all your debts + new mortgage + lot rent. If it would take more than 50% of your income to cover all of that – then the lender may deny you or require you to put down a large down payment.
Putting It All Together
So, to sum it up, here are the things you need to qualify for a mobile home loan:
- Steady Income: You need to have enough money coming in to pay back the loan and be able to show you receive that income.
Budget: Lenders will want to make sure you can still pay for the loan after taking care of your other debts.
Credit and debt: Usually, lender will make sure no more than 50% of your income would be going out to cover your debts and the money you plan to borrow and lot rent you’ll have to pay to the mobile home community. If it would take more than that to cover everything – the lender may deny you.
Get Ready to Move In!
Getting a loan for a mobile home is like putting the pieces of a puzzle together. Once you have these things in place, you’re on your way to qualifying for a loan and making your dream of owning a mobile home come true. Remember, it’s important to be honest about your income and your financial situation. That way, you can find a loan that fits just right for you.
Give us a call at Midwest Mobile Home Loans and start the application process now!
