Purchasing a mobile home with cash

Storz Management Company is a leader in the mobile home industry. Since 1957, we’ve been managing mobile home communities in California, Nevada and Oregon. Call us at (916) 989-5333 to learn more about our locations.

In this blog, we’ll discuss some things you should keep in mind before buying a mobile home in California. 

Housing costs in California

In California, mobile home costs vary depending on your preferred model. Generally, the larger the unit, the more expensive its price. 

According to a 2022 report from the U.S. Census Bureau, a single-wide mobile home on the west coast costs $91,900, while a double-wide unit costs $156,100. 

Extensions like patios and balconies add to the unit’s price. In addition, since mobile homes are factory built, you have to consider transportation and installation costs with your purchase. 

If you’re tight on budget, buying an older mobile home is one option. Just anticipate the renovation costs that may come with the unit.

Nonetheless, mobile homes are significantly more affordable compared to traditional homes. Zillow estimates that in 2022, stick-built houses in California cost approximately $769,405. Traditional homes are almost 500% more expensive compared to mobile homes. 

Likewise, although mobile homes have upfront costs, buying one may be cheaper in the long run compared to renting an apartment. This is because with mobile homes, the money you pay each month goes into paying for your property, and you’ll be able to build equity from it.

Buying vs. leasing land

Buying a mobile home is one thing, but finding the land for it is another. You have two options: install your mobile home on land you own or rent a spot in a mobile home community. 

If you’re looking to buy undeveloped land, know that you’ll have to pay several thousands just to connect your property with electric and water lines. The process is expensive and can also get complicated.

For most folks, renting in a mobile home park is the best option. Many mobile home communities in California, such as those managed by Storz Management Company, offer modern amenities like swimming pools, spas, fitness centers and more. 

Renting a mobile home park is relatively inexpensive compared to buying and developing land. Additionally, you won’t have to worry about upkeep expenses since the park handles everything for you. 

Financing options in California

Not everyone can afford to pay for their mobile home using cash. For most people, getting financing is necessary before they can buy their unit.

However, mobile home financing is not as simple as traditional mortgages. Most lenders won’t grant loans for mobile homes unless you’re also buying a piece of land and permanently installing your unit there. 

Nonetheless, you have several financing options if you’re looking to purchase a mobile home. The most common are chattel loans, personal loans, government financing and dealer financing.

1. Chattel loans 

Chattel loans are usually used to buy machines, vehicles and other movable property. However, some lenders will allow you to buy a mobile home with a chattel loan. 

Your mobile home will become the collateral for the chattel loan. If you default on your loan, the bank may possess your unit and sell it to another person. However, once you’ve repaid the loan, the unit becomes yours. 

Notably, it’s easier to get a chattel loan compared to other types of loans, even if you have a low credit score. It’s an excellent financing option if you’re looking to buy a manufactured home and install it in a mobile home park in California.

2. Personal loans

You can get a personal loan to finance your mobile home. These loans feature high interest rates and stricter credit requirements, but they don’t require collateral and are commonly available. They’re a great choice if you have good credit. 

Most lenders disallow you from using personal loan proceeds to purchase real estate. However, mobile homes are considered personal property so you can buy them through a personal loan. 

3. Government-backed programs

There are various government programs for first-time homebuyers that you can use to buy a mobile home. 

The Federal Housing Authority (FHA), the U.S. Department of Agriculture (USDA) and the U.S. Department of Veteran Affairs (VA) offer home loans to qualified individuals. Likewise, you can get reasonable interest rates through Fanie Mae or Freddie Mac loans. 

Know your credit score

Knowing your credit score before buying a mobile home in California is a good idea. 

All loan providers have their own credit requirements, and some lenders even conduct hard credit pulls that affect your score just to determine your rates. If you know your credit score, you will have an idea of which lenders you can get a loan from. 

Personal loans are a great option if you have good credit. However, if your credit score is less than impressive, you can opt for a chattel or other types of secured loans.

Remember, your credit score will affect your interest rate. You can save thousands of dollars annually by improving your credit before applying for a loan. 

Final word

Purchasing a house is a big financial and personal commitment. That’s why it’s important to make sure that you’re making the best available decision, considering your needs and situation. 

In California, buying a mobile home is one of the most affordable housing options you can get. With mobile homes, you get peace, comfort and security at a fraction of the cost of traditional houses.

If you finally decide to buy a mobile home, Storz Management Company is here for you. We manage several mobile home communities in California, with parks at Atwater, Bakersfield, Desert Hot Springs, Empire, Galt and Sacramento. 

Call us at (916) 989-5333 or leave us a message here to learn more about our communities. 

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