What Are Foreclosed Mobile Homes?
A mobile home or a static caravan is a prefabricated home built off-site and transported by truck or trailer to its final destination. These factory built houses come in all different shapes and sizes, but a majority of them are destined for a specific location and left there permanently.
Since most people can’t afford to buy mobile homes with all cash, they need to take out a loan on their home. Most lenders won’t give out mortgages on mobile homes, so instead buyers have to turn to more costly personal property loans. A foreclosed mobile home is a property in which the owner is unable to make the monthly payments on the home’s loan and the property is then foreclosed on, being, therefore, sold at an auction.
How Mobile Homes Are Built?
Unlike with a traditional property, prefabricated homes are built in a factory and then transported to their final destination. Most factories save money on the build by using an assembly line process in order to maximize efficiency and get the most out of their workers.
Usually, the builder will order all the materials for a mobile home in bulk in order to get the best discount. The first part of the actual build process involves welding the steel frame, which will then support the flooring. After that, the walls, electrical wiring and plumbing are installed. Lastly, the roof is attached to the structure.
Typically, the home will move from one station to the next, with highly skilled laborers that specialize in one aspect of the build process at each station. Once the structure is completed, the final step is to go in and add all of the buyer’s customized choices for windows, cabinets, flooring and appliances.
Sizes Available For Sale
Foreclosed mobile homes for sale come in a few different sizes. The most standard sizes that you’ll find are single-wide and double-wide. Single-wide mobile homes are 18 feet(5.5 m) wide or less and 90 feet(27 m) long or less1. They are usually towed to their final destination as one unit.
Double-wide mobile homes are 20 feet(6.1 m) wide or more and 90 feet long or less2. Since these units tend to be much larger, they have to be towed as two separate units and are then joined together on-site.
Since the process to move double-wide models is so labor-intensive, they are rarely relocated. On the other hand, single-wide models are re-sold and moved quite often or they can also be used as a trade-in when upgrading to a larger mobile home.
How to Transport a Mobile Home
Once you’ve found a foreclosed mobile home in some part of the country, you need to figure out how to get it to where you want to live. Transporting a mobile home is a tough job and often it’s best to leave it to the professionals. But if you insist on doing it yourself, there are a few things you’ll want to know ahead of time.
You might not realize it by looking at a mobile home, but each one is built on a frame and chassis. Usually there is some type of skirting around the base of the house to hide the wheels and tires.
Before moving, you’ll need to determine what the mobile home sits on. Usually they are bolstered up by slabs or blocks so that the home does not sink into the ground over time. Depending on how old the home is, it’s very likely that it will need new wheels and tires. You’ll also want to do a thorough inspection of the trailer’s frame and chassis to check for any structural damage.
Once all the prep work is done, your home is ready to actually be moved. In the old days, you could just hook up a tractor-trailer and move the home yourself. But today, the laws are a lot more strict and you’ll need to check the local permitting requirements in your area to find out if the move can be done yourself.
Most states require a tow-truck with flashing sirens that has been specifically designed for transporting mobile homes. Due to all the safety issues and regulations, it’s usually best for you to do all the prep work and then hire a moving company to do the actual move.
Ways of Investing in Foreclosed Mobile Homes
Mobile homes present an interesting investment opportunity since they are much cheaper than traditional homes. You’ll find a lot of listings for mobile homes for sale in your local paper, but if you want to save money you should invest in a foreclosure mobile home.
The mobile home buying process is relatively straightforward. You can find foreclosed mobile homes for sale by combing through newspaper listings or researching online. A realtor may not be a big help here since there are often no closing costs associated with buying a mobile home.
Since a majority of mobile home foreclosures sit on rented land, investors should make sure to speak with mobile park managers about any abandoned mobile homes they may have on their property. Since all the managers really care about is the potential rental income from the land, you can get these properties dirt-cheap, fix them up and rent them out or sell them.
Financing a Mobile Home
Once you’ve found that awesome deal on a foreclosure mobile home sale, obtaining financing for that property will present its own challenges due to the mobility factor. Have you ever noticed that you tend to get the best rates on home loans but higher rates on cars and boats? That’s because the latter require personal property loans.
Your best chance of obtaining a conventional mortgage though is to look like a normal buyer. You’ll want to own not only the mobile home but also the land it sits on. Remember, most mobile homes reside on rented land and this is one of the main sticking points with the banks as to why they won’t offer a conventional mortgage to most mobile home owners.
When it comes to selecting a lender, there isn’t a very wide selection of lenders to choose from when financing a mobile home. Unlike when you buy a normal property, a lot of the big banks won’t even deal with personal property loans so buyers are often at the mercy of the lender.
Are Mobile Homes, Travel Trailers and Modular Homes the Same?
Although the name might suggest otherwise, mobile homes don’t move very often. If you purchase a foreclosure mobile home, you’ll probably want to move it, but otherwise mobile homes tend to stay in the same place. Travel trailers on the other hand can often be towed behind any vehicle with a hitch. They vary in design, but trailers or house trailers provide a place to sleep on long road trips or when suitable lodging is not available.
Since there are similarities in the manufacturing process, mobile homes are often confused with modular homes. Although the build process is generally very similar, modular homes do not have wheels or even a chassis. Most modular homes are factory built and transported in one or two pieces to their final site by flatbed semi-trucks. You can learn more about modular homes here.
Can Mobile Houses be Attached to the Ground?
There are a lot of good reasons why an owner would want to attach a mobile home to the ground. In mobile home communities, the park manager or leasing company usually owns all the land so investors should consider this if they’re deciding between cheap houses and mobile foreclosures.
If the mobile home is separate from the land, you’ll have two sets of deeds, two tax records, two property records, etc. But once the home and the land are joined, the second set is eliminated and you’ll have only one legal description which should simplify taxes and zoning for you in the long run.
In order to physically attach your house to the ground, you’ll need to anchor it to the ground and make sure there are permanent utility hook-ups available. Depending on your state laws, you may be required to remove the towing hitch and all mobility aspects, including wheels and chassis. You could hire a professional or do it yourself, but either way, you’ll need a legal inspection after you’ve attached your home to the ground.
Mobile Homes Regulation - Departments in Charge
Most states have their own rules on buying a mobile foreclosed home but the US Department of Housing and Urban Development (HUD) is the federal group in charge of mobile homes. All mobile homes built after 1976 must be built to the Manufactured Home Construction and Safety Standards (HUD Code).
Before 1976, there was very little regulation and many mobile homes were constructed very poorly. With the introduction of the HUD code, manufactured home communities have become much safer. A HUD certified mobile home should display a red certification label on the outside of each transportable section.
Mobile Homes Parks
A mobile home park is a permanent area for mobile homes and trailers. Most people tend to live in mobile home parks due to the low cost of living or a need for temporary residence. Some might even use it as a vacation home.
In the United States, the perception of trailer parks has been stereotypical of a low income and impoverished class of people. And despite the modernization of trailers and mobile homes, this image has continued. More often than not though, this is not the case. Although mobile home parks do provide a lower cost of living, most of its residents are solid members of the community and reside there by choice. Most foreclosure mobile homes are found in trailer parks so should you decide to make an offer on a mobile home, be sure to consider the park that its located in.