When manufactured homes are personal property, FHA financing is NOT available. Instead, you will obtain a chattel loan. Not every bank or Lender offers a chattel loan.

A chattel mortgage can be used to purchase a manufactured home that’s not permanently attached to land. The chattel, or movable property, guarantees the loan and the lender backs it. You may know the loan as a security agreement, depending on where you live.

How does a chattel loan compare to a standard home loan? For one thing, chattel loans are typically much shorter than with a traditional mortgage. There’s also the fact that processing fees and loan amounts are up to 50% lower on these loans.

The one obvious downside of a chattel mortgage is a higher interest rate. In fact, the APR on these loans is much higher than standard home loans, depending on your credit situation. Typical chattel loans can currently range from 10.0% to 12.0+% with an amortization schedule of 20-25 years.

When you secure a chattel mortgage, your lender will hold a lien against your manufactured home. The lien, which is used as collateral for the loan, protects your lender’s interest in the property should you ever default on the loan. This gives them the ability to repossess the home and sell it to pay off the debt.

while every Lender has different requirements, typically, chattel lenders will require a minimum of 5-10% down of the total purchase price and/or appraised value of the home. Of course, this can vary depending on your credit situation. Most Lenders will not lend on a home if the age of the home exceeds 40 years.

The State of Florida has a 6.0% sales tax on the purchase price of your home and your local County has a discretionary sale tax that can be approx. 1-1.5%. Palm Beach County’s discretionary sales tax on a MH home, when it is personal property, is 1.% or max. $50 on the purchase price.

Your Sales Agent can connect you with several Lenders for a chattel loan.