5 Reasons Manufactured Home Deals Fall Apart Before Closing

Buying a manufactured home can be an affordable path to home ownership, but the sector of the market faces unique challenges that can cause issues for buyers and sellers. Understanding the most common reasons that deals fall through can help buyers keep their purchase on track. 

Financing issues 

Financing for manufactured homes is incredibly specialized, and faces unique challenges that don’t tend to impact traditional real estate. Not all lenders offer financing for manufactured homes, and loan eligibility is reliant on several factors, such as how the property is classified (personal or real), the age and condition of the home, buyers income and credit, and whether or not the home is attached to a permanent foundation. 

Park Approval Denials 

Many manufactured homes are located in a community park, rather than standing alone, and are therefore subject to park approvals and community standards. Community officers or park owners may assess buyers’ rental history, credit history, set income requirements, and complete backgrounds. Even if financing is approved during the home sale, the transaction may fall through if the park owner does not approve. 

Insurance Issues 

Many insurance companies offer limited coverage options when it comes to manufactured homes. Plan availability can depend on home condition, foundation type, property age, location, and weather risks. Premiums tend to be higher than buyers would expect, and coverage can be difficult to get for homes. 

Title Issues 

Manufactured homes tend to be titled more like vehicles as opposed to traditional homes. Common issues include missing titles, incorrect ownership records, errors in VIN numbers, which can delay or even prevent closing. 

Inspection Surprises 

Inspections may uncover issues previously unknown to buyers, like water damage, electrical issues, structural issues, foundation concerns, or other significant issues. 

Manufactured home sales successfully close when buyers can understand and navigate the unique market requirements. Working with experts in the industry, and having the necessary data infrastructure available can help streamline the path toward closing and help minimize obstacles along the way.