Purchasing anything used can be a frugal and prudent choice. I commend you. In a society that loves the latest and greatest, you’ve stepped off the beaten path and decided to make an investment in an affordable home. But even knowing all that, you’re still nervous, right?
I was you, just months ago – scouring the internet, asking anyone who would listen, and quizzing my lender about terms that made little sense to me. If this is your first homebuying rodeo, you don’t have to take the ride blind. We’re unpacking the things you need to know because, you need to know.
- The amount you’re pre-approved for (don’t shop without it). I know what you’re thinking. Shopping is a click away – it can’t hurt to start browsing, right? Wrong, it does hurt to shop without a price guideline. Then you begin your entire homebuying process ruled by emotion and want instead of practicality, efficiency, and affordability. Your pre-approval will give you the max amount you can borrow from a lender you choose to finance your home purchase. Seeking pre-approval may impact credit – it could negatively impact your credit so you do need to plan to avoid multiple pre-approvals which can be seen as risky credit behavior.
- You need to save more than you think. Your down payment will take some saving for (if you haven’t already). Think about $3,000 – $10,000 depending on the cost of your mobile home and the loan amount you want. It’s good to keep your credit card payments up to date while you’re home shopping, you can still use it, but making large purchases on credit should be avoided.
- The facts about the home’s history. Ask current or previous owners for details about the home or home and land that you are purchasing. If you want to own the place, you want to know what you’re getting. Before you sign a purchase agreement, do things like:
- Check out the data plate for the pre-owned, manufactured home (located under kitchen sink or master bedroom closet).
- Ask if the title is clear and check with the county recorder’s office to find out if there are any liens on the property.
- Find out if the home site shares a driveway
- Ask for a copy of the survey
- Check for any softness in vinyl and carpet flooring/ water damage to ceilings
- Know the thermal zone, roof load, and wind zone the home was built to as this will determine whether or not it can be moved to your area. Homes are built to specific building requirements to be able to withstand certain climate conditions.
- Visit the home site at night and during rush hours to understand traffic patterns and after it rains to check for any standing water on the property
- Ask about foundation and flooding in yard
- What kind of home insurance you want. Mobile home insurance is a big deal and there are many forms of coverage. Knowing the area around you is important as well. Is your potential home site in a flood zone or prone to flooding even if not in a flood zone, an earthquake area, or near a place that gets sink holes? Protection against these risks are often not included in common home insurance, so be sure plan to add them to your policy if needed.
- The details of your mortgage. Don’t be afraid to ask your lender hard questions. It is their job to articulate your loan details to you. Don’t be intimidated. Finance companies can often charge fees that could be negotiated, or are for services that aren’t needed, but if you don’t know about them you can’t help yourself.
- What you’re willing to put into home maintenance. Homes don’t do well when they just sit neglected. Are you willing to improve a fixer upper, are you willing to take care of your yard, or are you willing to do other monthly tasks? Be sure the nature, location and condition of your home fits the amount of work you’re willing to do.
- Paperwork and documentation is your new part time job. The entire process of homebuying and borrowing calls for lots of paperwork. You’ll have to send in a lot of documents (tax returns, bank statements, pay stubs, etc.) to your lender and real estate agent (if you have one) as well as sign many items. Be prepared and don’t get discouraged. The information you must provide will not always make sense. Ask for further explanation about what you are being asked to provide or sign.
Check into these items and you’re on your way to home ownership. The point is to find a home that will give you the financial freedom to enjoy your new lifestyle not be burdened or surprised by it. Use the tools in your tool belt and always be willing to look into other resources. You can do it!