VA Loans on Manufactured Homes
The Department of Veterans Affairs allows VA loans to be used on mobile homes, manufactured homes and modular homes. In many cases those three terms can be interchangeable; one thing that is not interchangeable is how the property is classified. If a mobile home, for example, is classified as “personal property”, the terms of the VA loan may be substantially different than if the mobile home is legally able to be classified as “real property”.
A real property classification changes many things–how the mobile home is taxed, for example. Under state laws property taxes on real property may be much greater than any applicable tax on personal property.
Consider the state tax paid on an automobile purchase; depending on state law the tax on a mobile home classified as personal property may be comparable. An automobile could never be classified as “real property”–it’s mobile, has no fixed foundation, etc.
A manufactured home classified as real property would have to conform to state laws. The State Code of Mississippi issued in 1972 provides an example of the kind of state guidance required to have a mobile home classified as real property:
“If the mobile home is to be classified as real property, then the wheels and axles must be removed and it must be anchored and blocked in accordance with the rules and procedures promulgated by the Commissioner of Insurance of the State of Mississippi. After the wheels and axles have been removed and the mobile home has been anchored and blocked in accordance with such rules and procedures, the mobile home shall be considered to have been affixed to a permanent foundation.”
“The county tax assessor shall then enter the mobile home on the land rolls and tax it as real property on the land on which it is located from the date of registration. At such time, the county tax assessor shall issue a certificate certifying that the mobile home has been classified as real property.”
A mobile home classified as real property by a certified state official may be eligible for a 30-year VA mortgage if it meets VA minimum property requirements and other typical rules that cover all VA home loans.
It’s best to consult with the regional VA loan center with jurisdiction in the area about a specific property or proposed VA loan application on a mobile home if a 30-year mortgage is needed–the regional VA loan center can help determine the best course of action.