Manufactured Homes Eligible for USDA Rural Development Home Loan Programs

 by Mary Beth Juergens 

I had the opportunity to speak during a session at the Iowa Manufactured Housing Association’s 65th annual meeting in Cedar Rapids held on November 12th. I want to again congratulate their entire association for organizing such an educational event. I enjoyed being among so many professionals with such enthusiasm and dedication to helping Iowans (and those in other states) achieve their homeownership dreams.

During my talk I discussed how USDA Rural Development’s home loan programs can be used to help rural Iowans finance new manufactured homes.

USDA Rural Development has two home-loan programs available for income and otherwise eligible applicants.  The first program is a federal guarantee on home loans made by approved lenders to moderate income households in eligible rural areas. The loan provides qualified borrowers up to 100-percent financing on a 30-year fixed-rate loan, while eliminating the need for a down payment or private mortgage insurance.

The USDA also has a direct home-loan program where we serve as the lender and provide 100-percent financing on home loans to eligible rural residents. Payment subsidy is also available.  For both programs eligible homes must be located in a community of 20,000 persons or less.

In most cases, a family of four with an adjusted annual income of up to $74,750 may qualify for the guaranteed home loan program. If that same family’s adjusted annual income is less than $47,450 they may also qualify for a direct loan.

As I mentioned at the Iowa convention, the USDA does have a few requirements when financing a new manufactured home including: the unit must be purchased from a dealer that is an approved dealer-contractor, the unit and site must be purchased as real estate, the unit must meet the Federal Manufactured Home Construction and Safety Standard and the unit be permanently affixed to a site-built permanent foundation.

The requirements for dealer contractors include:

• signing a construction contract covering both the unit and the site development,
• payment for the unit will be made only after it is permanently attached to the foundation and all persons furnishing labor or material in connection with the contract must sign a release of claimants, except for the manufacturer who must furnish an executed manufacture’s certificate or origin.
• Finally, the dealer-contractor must provide a warranty identifying the unit by serial number and must certify that the unit complies with plans and specs and has sustained no hidden damage during transportation.

All manufactured homes receiving financing from USDA Rural Development must have more than 400 square feet of floor area and a width of 12 feet or more for a single-wide unit and 20 feet or more for a double-wide unit.

During the past year USDA Rural Development’s home loan programs aided 2,400 families in rural Iowa in buying their own homes and many times that nationally. For more information about finance programs through USDA Rural Development, please visit . ##

(Editor’s Note: the words in parentheses above (and those in other states) were added, because the program does apply to the other states, as well as Iowa.)

 Mary Beth Juergens | Rural Housing Specialist, Rural Development, U.S. Department of Agriculture, 210 Walnut Rm 873 | Des Moines, IA 50309, “Committed to the future of rural communities”