Mobile Home Loans

Perhaps you did not know that mobile homes can appreciate in value as well. Mobile homes that are attached to fixed foundations appreciate with the years. The value of the home will be much greater that the purchase price after you have paid the mortgage for a few years. This difference between the appraisal value of the home and the mortgage value is mobile home equity.

Mobile home equity grows as the years go by. The owner of the mobile home also owns the equity, which is a financial asset. This can be used to borrow more money as a collateral. Mobile home equity loans can take a value of 85% to 100% of the built up equity value. This also depends on the lender’s policy and the borrower’s credit score.

It is easier to take a mobile home equity loan than to take a normal loan. The reason is that the equity on the mobile home is kept as collateral. The process is simple. (1) Appraisal of the property (2) Verification of the mortgage value (3) Calculation of the difference to get the equity.

Because of availability of collateral, mobile home equity loans are available at comparatively lower interest rates that other loans. In addition the repayment period is longer. Such loans are “a mortgage upon a mortgage”. Always remember that in these times of recession it is best to avoid debt.