FREQUENTLY ASKED MODULAR HOME LOAN QUESTIONS
CREDIT QUESTIONS
1. What Credit Score is Needed for a Modular Home Mortgage?
2. What does the Credit Score Represent?
3. How Can I find Out My Credit Score Before I Apply?
4. What About Consumers with Poor or Fair credit?
5. Where Can I get a 2nd Chance?
6. I Have Accounts being Paid through Consumer Credit Counseling Service, Can You Help?
7. Does getting a CCCS Completion Certificate guarantee approval?
8. I Have Collections Appearing on My Credit Report, Can You Help Me?
9. I Recently Filed Bankruptcy, Can You Help Me?
10. I have Unpaid Child Support Showing on My Credit Report, Can I get Financing?
11. What About Tax Liens & Judgments?
12. How Are Accounts that have been Charged Off viewed?
13. What About Repossessions and Foreclosures?
14. What if the Bad Credit is Not My Fault?
15. I Have Bad Credit. Can I use a Co-Signer with JCF Lending Group?
16. Can I Finance a Modular Home for My Family Member with JCF Lending Group?
17. Does JCF offer a First Time Buyer program?
18. What If I Always Pay Cash and Don't Use Credit?
DOWN PAYMENT QUESTIONS
19. Can I obtain 100% Financing for a Modular Home?
20. What are JCF's Down Payment Requirements?
21. Can I Borrow My Down Payment?
21. Can the Seller Help with Down Payment?
23. Do you Accept Gifted Down Payments?
24. Can I give a Cash Down Payment?
INCOME QUESTIONS
25. What Does My Debt Ratio Need to be?
26. What Are Acceptable Sources of Income if I'm Employed ?
27. What Are Acceptable Sources of Income if I'm Retired?
28. What are Acceptable Sources of Income if I'm Self-Employed?
29. What Are Acceptable Sources of Income if I'm in the Military?
30. Do You Consider Child Support?
31. What About Part Time or Seasonal Employment ?
32. What Income Sources Do Not Qualify?
33. Can I use Income from Rentals or Money I receive from a Roommate?
PURCHASE QUESTIONS
34. How Long does it take to get Approved for Purchase Financing?
35. What States Do You Offer Purchase Financing in?
35. What Types of Modular Homes Qualify for Financing?
37. Are there any Fees associated with Applying for Purchase Financing?
38. Is an Appraisal Required?
39. How Long is the Loan Process?
40. What are JCF's Foundation Requirements?
41. Why won't JCF Finance Modular Homes that Will Be Moved?
42. How are Down Payment Amounts Determined?
43. Does JCF Offer Land & Modular Home Financing?
44. My Modular Home is in a Park and/or on leased land, Can You Help?
45. My Modular Home is in a Co-Op Park where You Own the Land. Can you help?
46. My Modular Home is on an Indian Reservation, Can You Help?
47. Does JCF Finance Brand New Modular Homes coming from a Dealer?
48. Can I go through a Mortgage Broker when Financing with JCF?
49. Can I Buy a Modular Home Directly From a Home Seller or do I have to Use a Realtor?
50. What is the Minimal Amount you will Finance, and what are your Terms?
51. Is Escrow required in order to Close a Loan?
REFINANCE QUESTIONS
52. Should I Refinance My Modular Home?
53. How Long does it take to get Approved for a Refinance Loan?
54. What States Do You Offer Modular Home Refinance Loans in?
55. What Types of Modular Homes Qualify for Refinancing?
56, Are there any Fees associated with Applying for a Refinance Loan?
57. Is an Appraisal Required?
58. How long is the entire Loan Process?
59. Does JCF Offer Land & Modular Home Refinancing?
60. What are the Advantages of Refinancing my Modular Home?
61. I have a Clear Title on my Modular Home. Can I Borrow against it?
62
. My Modular Home is in a Park and/or on Leased Land. Can You Help?
63. My Modular Home is in a Co-Op park where You Own the Land. Can you refinance this?
64. I live on an Indian Reservation. Can I Refinance my Modular Home?
65. What is the Minimal Amount you will Finance, and what are your Terms?
66. Is Escrow required in order to Close a Loan?
67. When is a Refinance Not Advisable?
TIPS ON BUYING A USED MODULAR HOME
68. How to Determine What the Modular Home is Worth?
69. How to Choose a Realtor/Dealer?
70. Which Modular Home is Right for Me?
71. How do I get the Best Deal on a Used Modular Home?
72. What if there are Items in The Modular Home that Need to Be Repaired?
73. I Found a Modular Home. What's Next?
DOCUMENT & LOAN SPECIFICS
74. How Long are Your Loan Approvals Good For?
75. Do Your Loans Carry Any Pre-Payment Penalties?
76. Why is My APR Rate Different from My Loan Rate?
77. Can I Ever Move My Modular Home if I Finance with JCF?
78. With My Documents there is a Power of Attorney For Me To Sign, Why?
MODULAR HOME LOAN CREDIT
QUESTIONS
Q:What Credit Score is Needed for a
Modular Home Mortgage?
A: JCF Lending Group is an A paper
lender and we require good to excellent credit. Currently, our
minimum credit score for purchase financing is an Equifax 660,
straight refinance Equifax 660 and cash out or consolidation
requires an Equifax score of 700+. Modular Homes 1970 - 1975, in California
only, requires an Equifax 700, for both purchase & refinance.
JCF primarily uses Equifax Credit, but may also use Experian and
Trans Union. We will look at lesser scores on a case by case basis.
In all situations, you must have a minimum of 4 years of credit
history in order to qualify for a modular home mortgage. There are no exceptions.
Q: What does the Credit Score
Represent?
A: Simply put, the
lower the score, the more likely you are to file bankruptcy. The higher the score, the less likely you are to file bankruptcy. Keep in mind the bureaus have no idea of your monthly
income, but use other factors to determine your score. The most
important factor used in determining your score is your credit card
limits in relation to your outstanding balances. The higher the
limit, with a low or zero balance, the better. Likewise, a consumer
with credit cards at or near the maximum credit limit will equate
to a lower credit score. It is also important to know that
currently all credit bureaus score somewhat differently. We have
seen as much as a 100 point difference between bureaus.
Q: How Can I find Out My Credit Score
Before I Apply?
A: You must keep in
mind that there are three major credit bureaus. They are Equifax, Experian and Trans Union. You
can click on the credit bureaus above to obtain a copy of your
credit report and score. You may also correct information appearing
on your report that is incorrect at that time. Remember, it
normally takes 30 days for the correction, but can take as long as
90 days for inaccurate information to be accurately reported on the
bureaus.
Q: What About Consumers with Poor or Fair
Credit?
A: Unfortunately, our
low rates do not allow for us to make risky loans. But it is also
important to understand why. Recent studies have shown that Seventy
percent of modular homes that have been repossessed in recent months have
been owned by people in the sub-prime category, those people with
fair to poor credit records. Of the 7,000 repossessed in the last
three months, nearly 5,000 were on sub-prime mortgages. Those
figures jump dramatically when you look at a two year time span.
Nearly 90% of consumers with poor credit will be seriously late
or will have gone into collection on their Modular Home mortgage.
Q: Where Can I get a 2nd
Chance?
A: Not with JCF
Lending Group. The window for obtaining a loan with fair or poor
credit is slowly closing. Most lenders that lent on fair or poor
credit are no longer in business and the ones that still are
request large down payments, charge outrageous closing fees and are
charging 12% - 19% interest rates. Most consumers would consider
this unfair, but can you imagine gambling in a casino that
advertised that your odds of winning are 10%? Most people would
simply find those odds unacceptable. We feel that lending to
consumers with bad credit is not good for the consumer or the
modular home industry.
Q: I Have Accounts being Paid through
Consumer Credit Counseling Service, Can You Help?
A: No. If you are
currently in a CCCS program or any other type of similar program,
we cannot assist you until you receive your letter and/or
certificate of completion from that particular program. You must
keep in mind using a credit/debt counseling service is comparable
to filing a repayment type bankruptcy. Legitimate programs such as
CCCS will have you sign an agreement that states you will not
procure any new credit when you are in the program.
Q: Does getting a CCCS Completion
Certificate guarantee approval?
A: No. First and
foremost, you must realize that there are several programs out
there offered by legitimate services such as CCCS and other
non-legitimate services that do more harm than good. All programs
have one thing in common, they retain a portion of your monthly
payment as a commission and/or fee. This comes directly out of the
creditors pocket and may be reported to the credit bureaus, in many
cases, as "Settled for Less Than Balance" or in some cases the
accounts will show "Charged Off". In other instances, your service
and/or program may not pay your credit accounts by the due date,
causing multiple late payments to appear on your credit reports
that will be reported for up to seven years.
Q: I Have Collections Appearing on My
Credit Report, Can You Help Me?
A: First, any collections appearing on
your report will need to be paid prior to the time of close, which
means that funds from your loan, in the case of a modular home refinance
consolidation loan can not be used to pay the outstanding
collection(s). Assuming your collection(s) are paid, the type of
collection can greatly affect your credit score. An unpaid hospital
or doctor bill would have less effect than a utilities collection.
Overall, collections have a very negative impact on your credit
score and profile. JCF will require a customer explanation on all
collections and will require that explanation in writing.
Q: I Recently Filed Bankruptcy, Can You
Help Me?
A: In general, your bankruptcy must have
discharged for a minimum of 4 years before JCF
Lending Group would consider your application. You must keep in
mind that there are two common types of bankruptcy, Chapter 7,
where your debts are wiped out completely upon the discharge date.
There is also a Chapter 13, where you pay a portion of your debts
over a period of time, normally 3 - 5 years, after which time the
bankruptcy will be considered discharged. Meeting the 4 year
minimum does not guarantee approval. Consumers must have
re-established their credit after the discharge date, have an
installment loan for a minimum of 2 years and cannot have any
derogatory credit after the bankruptcy. An installment loan is
normally, but not limited to, a car loan.
Q: I have Unpaid Child Support Showing on
My Credit Report, Can I get Financing?
A: JCF, along with
most lenders cannot or will not lend to consumers with outstanding
child support payments due. To qualify for financing, you would
need to show that your child support has been brought back to
current and we would need written proof of this prior to the
funding of any loan. Lenders look at child support as a monthly
obligation, just like a credit card or car payment. In the
case of a refinance debt consolidation loan, funds from the loan
can not be used to pay the child support obligation.
Q: What About Tax Liens &
Judgments?
A: JCF requires that
all judgments and liens, to include tax liens, be paid in full. We
will not consider consumers who are on or have made a payment
agreement with the sources involved. Also, it is important to point
out that the very reason for posting the judgment or lien is stop a
person from obtaining credit prior to payment of such lien or
judgment. In the case of a refinance debt consolidation loan, funds
from the loan can not be used to pay liens or judgments.
Q: How Are Accounts that have been
Charged Off viewed?
A: Overall, very
negatively, by both JCF and the credit bureaus. Because an account
has been charged off, we will not require that account be paid. We
will, however, look at charged off accounts on a case by case
basis. The charge off must have occurred at least 24 months prior
to applying for credit. Multiple charged off accounts will result
in a decline. Charged off accounts are one of the most damaging
items that can appear on your credit report and/or profile.
Normally a charged off account means that all collection efforts
attempted by the creditor were ignored and the creditor felt that
the debt was un collectable.
Q: What About Repossessions and
Foreclosures?
A: There is always an understandable
reason why your car or home was repossessed or foreclosed upon, but
the impact on your credit could not be worse. As a rule, a recent
repossession will be considered as cause for an automatic decline.
We may consider repossessions as long as the repossession occurred
at least four years prior to application. Again, this is on a case
by case basis. Foreclosures appearing on your credit report are
always cause for an automatic decline. Your home and your primary
transportation should always be your first concern.
Q: What if the Bad Credit is Not My
Fault?
A: Bad credit normally
never is, as far as what we have been told. The culprit is normally
an ex-spouse, business partner, girlfriend, boyfriend, or family
member. In the last few years, identity theft has risen to the top
of the list. It is your responsibility to check all three of your
credit reports annually to check for inaccurate information.
Unfortunately, even consumers who fell behind due to illness have
to meet our credit standards. If your name is on an account, either
as a co-signer, authorized user, or on a joint account, you are
legally responsible, even if the other person agrees to pay by way
of verbal agreement, contract or divorce decree. If this person
does not pay the debt, you are financially responsible, and the
lending institution can come after you for the unpaid balance. This
can greatly affect your credit rating and score.
Q: I Have Bad Credit. Can I use a
Co-Signer with JCF Lending Group?
A: No. Every applicant
must meet our credit criteria. We would caution potential consumers
looking for this solution, as most upscale parks and leased lot
communities will not grant approval for residency for consumers
with a poor credit history. Normally, all occupants over the age of
18 that plan to live in a modular home park or leased lot
community must pass both a credit and criminal
background check.
Q: Can I Finance a Modular Home for My Family
Member with JCF Lending Group?
A: No. All applicants
must live in the modular home. Many times consumers will apply for a
modular home mortgage stating that the modular home they wish to purchase will be their
primary residence. If we discover within a one (1) year period of
time that the applicant(s) that initiated the loan do not, in fact,
reside in the modular home, your loan agreement allows us to repossess the
modular home and retain any down payment and/or equity that may be present.
Your application will be considered fraudulent and possible
criminal charges may be initiated. We have several ways to verify
residency. Also, it is important to realize most parks and leased
lot modular home communities require ownership of the modular home in
order to live in the park or community.
Q: Does JCF offer a First Time Buyer
Program?
A: Yes. We do not
require previous modular home ownership for an approval. This does not mean
that we can can approve consumers with limited credit, as stated,
we are an A paper lender. Unfortunately, this term is normally used
by consumers with less than perfect credit. Buying your first modular home
should not be confused with trying to purchase with fair or poor
credit. We do require a minimum of four (4) years of credit depth,
with no less than two (2) years of Installment credit, which is
normally, but not limited to an automobile loan. An applicant who
is 20 years old, even though they have established credit, and paid
their bills on time, would not meet our criteria because of the
limited credit depth.
Q: What If I Always Pay Cash and Don't Use Credit?
A: We hear this question quite commonly and the answer is quite simple. If you have always made your large purchases with cash, then continue by paying for your modular home purchase with cash. Many consumers live their lives, avoiding credit cards and paying for automobiles with cash from savings. Lenders make credit decisions based on your previous credit experience, no experience, no loan. Something interesting to point out, recent studies have shown that 80% of the consumers that say they "Have no credit", normally have negative items appearing on their credit reports that have stopped them from obtaining credit. Another 10%, do not have credit due to, recent extending prison terms, the social security number they are using is not their own and most commonly their are illegal aliens, using a purchased social security card. Finally the remaining 10%, truly use cash as an option of choice.
MODULAR HOME LOAN DOWN PAYMENT QUESTIONS
Q: Can I obtain 100% Financing for a
Modular Home?
A: No. We require a
minimum 5% down payment on all purchase transactions. We should be
clear that a 5% down payment may not be acceptable in all cases.
The final determination if a 5% down payment will be sufficient
will be determined by either an Advanced Book Value Report or an
appraisal. The year of the modular home determines the maximum LTV or loan
to value of the modular home in question. Modular homes 15 years and newer should qualify for the 5% down payment program, but in some cases, an
older modular home will qualify for this program as well. For example, a
1982 modular home that appraises for $100,000, but the sales price is
$50,000, should qualify for the 5% down payment because of the
equity involved. The appraisal or book value report can offset the
needed down payment either positively or negatively.
Updated Policy: Consumers with multiple current mortgages and/or residences, to include vacation homes, will now be required to have a minimum down payment of 20% on all purchases. This policy change is due to the recent influx of consumers wishing to walk away their current home, in favor of more affordable housing. This policy is only a temporary change until the housing market has recovered. Consumers wishing to purchase a modular home as their primary and only residence can still enjoy down payments as low as 5%.
Q: What are JCF's Modular Home Down Payment
Requirements?
A: As stated above, we
require a minimum of 5% down payment for our modular home
purchase program with rate breaks at 10% & 20%. We require that
consumers provide two (2) recent bank statements to support that
the proceeds were in the bank and not borrowed. We also must see
all down payment checks as a condition of funding. If the down
payment is coming from a 401K account or a home sale, we will need
to see a paper trail to support the down payment proceeds. If you
are in doubt, please contact customer service for more information
and/or clarification.
Q: Can I Borrow My Modular Home Loan Down
Payment?
A: No. Your down payment can
never be borrowed in the form of another loan or from a 3rd party expecting repayment. If we discover in the loan process, that your
down payment was in fact borrowed, your loan will be cancelled and
you will not be eligible for a refund of any appraisal or
inspection fees paid to others to secure your modular home loan with JCF. Keep
in mind that many consumers wishing to purchase a vacation
modular home assume they can take a 2nd out on their current
home for the down payment. This again will not qualify. The only
exception to this rule would be funds borrowed again a 401K or
pension. This will need to be approved on case by case basis.
Q: Can the Seller Help with My Down
Payment?
A: No. The seller can
never participate with the down payment. The seller can rebate
and/or assist the buyer, such as splitting appraisal costs, or
closing costs, however any monetary credit(s) can not be in lieu of
down payment proceeds. Many times throughout a year we discover
this, which ends badly for all parties. Your loan will be cancelled
and you will not be eligible for a refund of any appraisal or
inspection fees paid to others to secure your modular home loan with JCF. You
may also risk the loss of your earnest monies, depending on your
purchase agreement and applicable laws.
Q: Do you Accept Gifted Down
Payments?
A: Yes, although when all or part of
the down will be gifted, the minimum down payment now
raises to 10%. We will require a paper trail for the gifted down
payment along with a letter from the person providing the gift,
stating that the gift will not need to be repaid. The donor will
also need to provide a copy of the canceled check written for the
gifted down payment, and a copy of their bank statement showing the
gift monies in their account. The gift can not be from the
seller(s), realtor or dealer. The person who gifted the monies must
be a relative or personal friend. We do not accept city, county,
federal or a private down payment coming from an assistance program.
Q: Can I give a Cash Down
Payment?
A: You can, but you
will be required to supply a paper trail of where this down payment
money came from. It is always best to use cashier's checks from
your bank so you have a track record of the transaction. Under the
Patriot Act, we must provide proof of all down payment proceeds
and where they came from. This is a Federal Requirement, not a JCF
Lending Group requirement. We will also need to get a receipt from
the seller stating they received the down payment from you in the
form of cash.
MODULAR HOME LOAN INCOME QUESTIONS
Q: What Does My Debt Ratio Need to
be?
A: JCF Lending Group
actually uses two different income formulas, both based off of your
gross monthly income. Both formulas were conceived so that your
house payment is affordable, making long term modular home ownership a
reality. First, we look at your housing ratio. This is all payments
attributed to the cost of the modular home you are buying or residing in,
plus any other mortgages that you may be responsible for. Most of
our clients live in leased lot communities where lot rent is a
factor. Your new house payment plus lot rent with $50.00 added for
insurance should not exceed 34% of your gross monthly income. We also
consider your Debt to Income Ratio, commonly referred to as DTI.
Your debt to income ratio should not be in excess of 45% of your gross
monthly income. To come to this figure, we add all monthly debts appearing
on your credit report, along with your new house payment, space
rent and $50 insurance and divide your gross monthly income into
that figure to come up with your DTI. Consumers with high credit
scores can sometimes exceed these requirements on a case by case
basis.
Q:What Are Acceptable Sources of Income
if I'm Employed ?
A: You will need to provide to JCF
Lending Group a copy of a current or your most recent paycheck stub
showing year to date figures, a W-2 for
the previous year, and a Verification of Employment letter on
Company Letterhead stating your hire date, and current position.
This letter needs to be signed and dated by a representative of
your employer. JCF Lending Group will sometimes require 2 years of
W-2's from your employer depending on your hire date. If you have
been in the same line of work for 2 years, but at your current job
for less than 1 year, we will need to obtain a W-2 from both
employers, both previous and current, and letters of employment
from both employers. Also, if you have been on your current job for
less than one (1) year, and had a large time period between jobs,
we may not be able to assist you until you have been at your
current job for one (1) full year. If you are new to a job, and it
is a different line of work than your previous employment, we would
not be able to provide financing until you have been there for one
(1) full year.
Q: What Are Acceptable Sources of Income
if I'm Retired?
A: There are many
types of income for retired persons. JCF Lending Group will
determine what type of proof you will need to provide depending on
the source. If your source of income is Social Security, we will
require an award letter from the Social Security Administration,
and proof of receipt of income, usually 2 months bank statements if
the income is direct deposited. In the case of annuities, pensions,
or withdrawals from an IRA account, we will need to see the
statement sent to you by the source showing the balance, and 2
months bank statements showing the deposits. All income sources
need to be deposited and/or paid on a regular basis. Simply having
money in savings and/or on deposit does not by itself qualify as
monthly income.
Q: What are Acceptable Sources of Income
if I'm Self-Employed?
A: If an applicant is Self-Employed,
JCF Lending Group requires 2 years tax returns with all schedules.
A customer must be in business for a minimum of 2 full years. Our
bottom line is what is being reported on Schedule C, averaged over
24 months. We cannot use gross receipts, etc. that appear on your
returns. In the case that a customer owns a company or corporation
and personal bills are paid through and by the business, we will
require both 2 years of personal tax returns (Form 1040), and 2
years of the company or corporate tax returns
Q: What Are Acceptable Sources of Income
if I'm in the Military?
A: For those customers
that are currently in the Armed Forces, JCF Lending Group will
require a Leave and Earnings Statement (L.E.S.) which shows your
enlistment date, current rank and pay grade, and salary
information. If this customer is on active duty, we will not
ordinarily require a Verification of Employment letter, as this
information is reported on the L.E.S. Statement. In the case where
a customer works for the Military, but is considered a Civilian, we
will require a paycheck stub, W-2, and a Verification of Employment
letter by the Supervisor of the department.
Q: Do Your Loans Consider Child
Support?
A: Yes. Child support
is considered a source of income. The most basic requirement is that the
support must last a minimum of 24 Months from the conception of
your new loan. There are two types of child support that have
different requirements. Below we have addressed both types of child
support income.
Court Ordered - In this situation, we will need a copy of the court order
or divorce decree, showing the child support amount and the terms
of support. We will also need proof that 12 months of support has
been paid and received. Proof of payment can be a statement from the court, if
paid by the court or county. If paid by check from the obligated
parent, 12 months bank statements or cancelled checks are normally
sufficient.
Voluntary - This can be accepted on a case by case basis. We must see
proof that the support payments have been paid consistently for a
minimum of 24 months. As mentioned above, proof will normally
consist of 24 months bank statements or cancelled checks. Child
support payments with no paper trail or irregular payments cannot
be considered.
Q: What About Part Time or Seasonal
Employment ?
A: Part time or
seasonal employment can be used for income purposes. We do require
a minimum of two (2) years job time on any job considered part time
or seasonal. For income determination, we average the last 2 years
income derived from the part time or seasonal employment. We will
require two (2) years of W-2's provided by your employer, a copy of
your most recent paycheck stub, and a Verification of Employment
letter on Company Letterhead stating your hire date and current
position. This letter needs to be signed and dated by a
representative of your employer.
Q: What Income Sources Do Not
Qualify For a Modular Home Loan?
A: There are several
sources of income that cannot be accepted: Unemployment insurance
payments, both State & Federal temporary disability insurance
payments, workers compensation or any employment or job where you
are paid under the table or monies not declared for tax purposes
cannot be considered. State and Federal disability, unemployment
insurance, and workman's compensation are all considered a
temporary source of income, and cannot be used or added into your
monthly or annual income.
Q: Can I use Income from Rentals or Money I receive from a
Roommate?
A: You can, as long as this income is declared on your tax returns.
For rentals, we will require the appropriate schedule from your
1040's for a minimum of 2 years showing rental monies received,
depreciation, repairs, taxes, etc. You can use income received from
a roommate, again, as long as it is declared on your tax returns.
We cannot accept canceled checks or letters stating the roommate
pays money to live there every month.
MODULAR HOME PURCHASE FINANCING QUESTIONS
Q: How Long does it take to get Approved
for Modular Home Financing?
A: If you apply by phone, normally 15
minutes. If you apply online, normally 24-48 hours. Some
applications may take slightly longer in cases where additional
information is needed. If additional information is needed, we will
contact the appropriate party by phone and/or email. If you need an
answer fast, simply call us at (866) 967-0143. The modular home loan approval you
receive will be valid for 60 days and cannot change in that time
period.
Q: What States Do You Offer Modular Home
Financing in?
A: We offer
modular home financing in the following States:
ALABAMA, ARIZONA, ARKANSAS, CALIFORNIA,
COLORADO, DELAWARE, FLORIDA, GEORGIA, ILLINOIS, INDIANA, IOWA,
KANSAS, KENTUCKY, LOUISIANA, MARYLAND, MICHIGAN, MINNESOTA,
MISSISSIPPI, MISSOURI, MONTANA, NEBRASKA, NEW MEXICO, NEW
YORK, NORTH CAROLINA, NORTH DAKOTA, OHIO, OKLAHOMA, OREGON,
PENNSYLVANIA, SOUTH CAROLINA, SOUTH DAKOTA, TENNESSEE, TEXAS, UTAH,
VIRGINIA, WASHINGTON, WEST VIRGINIA, WISCONSIN and
WYOMING.
Q: What Types of Modular Homes Qualify for
Financing?
A: JCF Lending Group
finances manufactured homes, mobile homes and park "RV" models. We can finance single
and multi-section homes as follows, single section modular homes can be no
older than 20 years. Multi-Section modular homes can be no older than 1977,
with the exception of California, where the multi-section mobile homes can
be 1970 & newer. All modular homes must be in good condition, and must
not need major repair, to include roofing, skirting, siding and
carpeting. The modular home must have been previously titled and cannot be
a brand new modular home being sold by a dealer. If the modular home must be
financed and then moved, we are not the lender for you.
Q: Are there any Fees associated with
Applying for Modular Home Financing?
A: No, JCF Lending
Group does not charge an application fee. There may, however, be
fees associated with the modular home loan program that you
choose. Once you are approved, your loan representative will go
over all fees that will be financed into your new modular home loan.
The most common out of pocket expenses would consist of homeowners
insurance and the cost of an appraisal and/or inspection. If the
modular home is in a leased lot community, there is commonly the first
months rent to pay, along with a security deposit. Contact the park
for details.
Q: Is an Appraisal Required For A Modular Home Mortgage?
A: An appraisal may or
may not be required, depending on the NADA book value of the modular home
and the amount you want to finance. An inspection is always required on every transaction. An inspection will give the overall
condition of the modular home, and additional options of the modular home, such as
decking, awnings, garages, etc. If we have enough value booking the
modular home out using the inspection, an appraisal is not required. An
appraisal is required if we do not have the value using the above
method. Appraisals take into account recent sales from the same
community, and surrounding area, community adjustments, and
location to determine the value. An appraisal is almost always
needed and recommended in the State of California. There are a
handful of other states where an appraisal is required. Contact a
JCF customer service representative for more information.
Q: How Long is the Modular Home Loan
Process?
A: Modular home sales normally
take 2-3 weeks, depending on if an appraisal is required. Keeping
the communication channels open with your loan officer can normally
always expedite the modular home loan process. Your loan officer will provide
you with a list of items, called stipulations, that we will need
you to fax or email to us. Once we have these items and your
appraisal/inspection has been completed and cleared, we will be
ready to send out closing paperwork.
Q: What are JCF's Foundation
Requirements?
A: JCF Lending Group
has no specific foundation requirements, as previously mentioned,
the modular home must be set-up and in move-in condition, to include
functioning electrical and plumbing. The modular home can be on blocks,
iron pier settings, ground set or on a full foundation with
basement. We finance the modular home, not the land, so we are not
concerned about the modular home being tied to the land by way of
foundation.
Q: Why Won't JCF Finance Modular Homes that Will
Be Moved?
A: From our past
experience, the amount quoted to move a modular home
by a mover is 75% of the time inaccurate or grossly
off. This might not be intentional on the part of the modular home mover,
but it leaves many consumers with an unexpected cash outlay that
they may or may not be able to come up with. The current average
approximate cost to tear down, move, and re-set up a single wide modular home
is $4,000.00. That is if the modular home is moved 5 miles or less. When
the modular home is a multi-section home the average cost jumps to
$10,000.00. These costs do not include the multiple fees paid to
the county for trip permits, escorts, or multiple inspections that
will be required before you can reside in the modular home. Again, many
times the cost jumps dramatically higher than the quoted figures
above, leaving the consumer with a modular home in pieces or not set-up,
which they cannot legally live in.
Q: How are Down Payment Amounts
Determined?
A: Our minimum
acceptable down payment is 5% of the selling price. This should not
be confused with loan to value, also called LTV. The value is
determined by appraisal or book value which will be determined by
your loan underwriter. All LTV percentages include all fees that
are financed into the loan, including taxes & insurance, if
applicable. As a basic rule, modular homes that are fifteen (15) years old or
newer have an LTV of 95%, modular homes built from 1976 to 1994, have an 85%
LTV. California mobile homes between the age of 1970 and 1975, have a 75%
LTV. Overall, value times LTV equals the maximum amount
to finance, including all fees.
Q: Does JCF Offer Land & Modular
Home Financing?
A: No. JCF Lending
Group is a modular home only lender. If there is land or
acreage involved in your transaction, we are not the lender for
you. JCF is not licensed to finance land or the combination of land
and modular home. We can only finance the modular home when it has not
been deeded together with land. Most of our customers live in
modular home parks, communities or rented/family
land situations.
Q: My Modular Home is in a Park and/or on
leased land, Can You Help?
A: Yes. JCF
specializes in this type of modular home financing and/or
loan. In fact, this is what the name of our URL
(www.chattelmortgage.net) means, a loan for a modular home not attached to
property by way of deed or title. We offer the lowest rate &
fee combination Nationwide.
Q: My Modular Home is in a Co-Op Park
where You Own the Land. Can you help?
A: No, not at this
time. Co-Op parks are not considered real property and they are not
considered personal property or Chattel, the correct term. In a
Co-Op park each owner buys a share. The share gives them ownership
of a percentage of the park, including the roads and common areas.
The land sitting under a modular home in a Co-Op park is not
owned by the modular home owner, but rather all share holders in the park.
So, for example, if the park has 300 homes, the ownership of the
park is divided up into 300 shares. Our type personal property
loans, commonly called Chattel Mortgages, have foreclosure
solutions that consist of selling the modular home at it's current location
or moving the modular home out of the park or from its current location. Because
of the multiple owners of the land, we would need each
shareholder's permission to accomplish this, which is not feasible.
There are proposed law changes that may open Co-Op parks to
personal property loans in the near future.
Q: My Modular Home is on a Indian
Reservation, Can You Help?
A: No, not at this
time. Indian Reservations are unique as the true ownership of the
land is the Tribe, similar to a Co-Op park. As the tribe grants you
land, they retain the ultimate ownership of that land and access to
the reservation. In the past, we have made loans in reservations
with the agreement of the tribal counsel that we could enter the
reservation and/or property in the event of default. We have found
that a decision by the current tribal counsel can be overridden by
a future counsel, making our previous agreement null and void,
leaving us without the right of repossession in the event of
default.
Q: Does JCF Finance Brand New Modular Homes
coming from a Dealer?
A: No. There are
several reasons why we do not finance brand new modular homes from dealers.
First and foremost, our approvals are only good for 60 days.
Normally, it takes between 90-120 days to have a modular home built and
delivered. Our approval would not be valid at the time of delivery.
Second, the dealer is responsible for any and all warranties,
either written or implied. When a lender agrees to finance a brand
new modular home, they are, as well, bound to any promises made by the
dealer. If the dealer goes out of business or does not fulfil their
obligation, the lender must do this. Finally, reputable dealerships
have contracts in place with lenders that pay the dealership for
application origination.
Q: Can I go through a Mortgage Broker when
Financing with JCF?
A: No. Unfortunately,
due to Fair Lending Practices, all consumers based on their credit
worthiness and the modular home they wish to purchase or refinance are given the same
rate and applicable fees. JCF Lending Group offers the lowest rate
& fee combination in the industry. This could not be
accomplished by adding thousands of dollars to your new mortgage to
pay commissions to a mortgage broker.
Q: Can I Buy a Modular Home Directly From a Home
Seller or Do I have to Use a Realtor?
A: Yes, you can buy a
modular home directly from the home seller and/or owner. We will provide
all closing instruments, to include a purchase agreement and
closing statements. JCF Lending Group provides a complete internal
escrow service which is included with your new modular home loan. In many cases,
buying a modular home directly from the seller saves the seller thousands
of dollars, which can result in a lower selling price because
there are no realtor commissions to pay.
Q: What is the Minimal Amount you will
Finance, and what are your Terms?
A: Our minimum amount
to finance is $20,000 Nationwide, with the exception of California,
which is $30,000. Exceptions to our minimum to finance can be made
on a case by case basis. There is no maximum amount to finance. Our
terms range from 7 - 25 years, with the following basic guidelines.
Our terms are dependent on the amount financed. Typically, for
balances less than $40,000 we can provide a maximum term of 15
years. If the balance exceeds $40,000, we can offer a maximum term
of 20 years. Exceptions can be made on the term on a case by case
basis. Our California Pre-Hud program, which is mobile homes built from
1970 - 1975, caps the term at 15 years. No exceptions can be made
on this regardless of the balance.
Q: Is Escrow required in order to Close a
Modular Home Loan?
A: Escrow is not
required in any state, with the exception of California, where it
is mandated by law. Escrow in California is handled by a third
party escrow company. You may opt for one of your own choosing, or
JCF Lending Group also has friendly relationships with several
escrow companies, if you prefer us to open escrow for you. In all
other states, escrow is handled internally by our office, where we
do all functions from titling the modular home, to cutting disbursement
checks to realtors, if applicable, and to the seller(s).
MODULAR HOME REFINANCE QUESTIONS
Q: Should I Refinance My Modular Home?
A: First and foremost, determine your goals when refinancing a modular home. There are only 3 realistic outcomes and these should be considered carefully. 1) Lower monthly payment. 2) Shorter Term. 3) Cash Out and/or consolidation of debt. Many consumers mistakenly believe that by reducing their interest rate, they can accomplish all of the options listed above in one transaction. Although it is possible, it would be uncommon and very unlikely. Making a decision to refinance your modular home is an important step, one that should not simply be a rush to get a lower rate. You need a goal and the patience to make a wise decision. You should also shop for a modular home mortgage wisely, avoid common pitfalls that may do more harm than good. Here we will detail some important aspects of possible goals and how to shop for a modular home loan or mortgage. We will start with realistic goals and move on how to shop for a modular home mortgage.
A1) Be Realistic - Ask yourself, is your credit better now than when you purchased your modular home? If the answer is No, is it realistic to expect a lender to offer you a lower rate? If your credit has declined, you are a higher risk and with high risk comes high interest rates. If you have trouble making your house payment now or are behind in your house payments, is it rational that a lender would want to jump into the shoes of your current lender. The answer to that is simple, it is not likely to happen. In today's times you must have good to excellent credit to get the better interest rates.
How long do you plan to live in the modular home? Are you selling the modular home or only plan to leave in the modular home for a short period of time? Then refinancing is never a good choice and should be avoided if possible. Refinancing should be considered for long term ownership. You must remember that most modular home mortgages carry fees and those fees are stacked onto your current loan balance. This means that every refinance loan has a break even point when the cost of the new mortgage has been paid for. Below is an example;
Total extra cost: (Escrow fee, loan fee, title fee, and so on.) |
$1,500.00 |
New monthly savings per month: |
$100.00 |
Break Even Point, where consumers see a positive benefit : |
15 months |
A2) Lower Monthly Payment - How much are you hoping to save each month? This is where reality hits, don't assume you will save hundreds monthly. Review our current modular home loan rates and then use a payment calculator to estimate your new payment. Remember to add $10 - $20 dollars to that payment for possible closing costs and fees that may be financed into your new loan. When attempting to achieve a lower monthly payment, you will be presented with a few choices, described below.
A) Keep your current remaining term on your existing mortgage. For example, if you have 178 payments left on your current mortgage, request your new loan term to be no more than 178 months. This is a wise choice for consumers looking to reduce their monthly payment, while not losing equity due to increasing the length of the loan.
B) Reducing your current term while still slightly reducing your monthly payment. This is the most beneficial type of refinance, where the consumer sees a lower payment and reduces the interest that he or she will pay. By reducing the term of a mortgage, most consumers will save thousands in direct and immediate interest savings.
C) Extending your current term for payment relief. This option should only be considered as a last resort. This option does reduce your monthly payment, but it also increases your overall interest burden and/or debt. As mentioned, this option should only be considered in extreme cases.
A3) Shorter Term - This should be the ultimate goal of anyone considering refinance, when possible. Many consumers keep their payment amount the same or in some cases slightly less, while drastically reducing their term, normally saving thousands of dollars. Below is an example, using a loan balance of $80,000.00:
Current Loan: Remaining Months: 264 Months @ 10.50% = $778.01 = |
$205,394.64 |
New JCF Loan: 180 Months @ 6.99% = $718.62 = |
$129,351.60 |
Overall Savings: = |
$76,043.04 |
A3) Cash Out and/or Consolidation of Debt - Consumers looking for this type of refinance option break into two categories, consumers looking to borrow money on a clear title and those that have an existing mortgage and are looking to pull equity from their modular home. It is important to realize that our industry does not offer 2nd mortgages and/or equity lines of credit. If you are looking for a loan to pull equity from your modular home, you will need to refinance your current mortgage and establish a new mortgage. There are several reasons to consider debt consolidation or getting cash from your equity to include:
*Fewer Bills - Modular Home debt consolidation loans can reduce the number of bills you need to manage every month. For many borrowers, lower interest rates and fewer checks to write each month are good reasons for consolidating debt.
*Lower-Interest Payments - Typically, borrowers consolidate debt into lower-interest payments. Debt consolidation loans may help lower double-digit interest rates down to single digits, which translates into monthly interest payment savings.
*Potential Tax Savings - Modular home owners who choose a refinance mortgage loan to consolidate debt have the added benefit of potential tax savings. Modular home mortgage interest is tax-deductible, which means that interest paid on a mortgage loan used to consolidate debt is likely to be tax-deductible. Be sure to check with your tax advisor for details.
*Cash In Hand - There can be many reasons for the need for a large sum of cash, from opening a business, that much needed vacation, home improvements or your child's college tuition, the reasons can be endless.
As there are many benefits to cash out or consolidating debt, there are some drawbacks to include:
* Continued overspending - Consolidating debt can be very beneficial, but without a change in spending habits you may find yourself deeper in debt. So if overspending was the reason you needed to consolidate debt in the first place, be careful not to make the same mistake again. Don't consolidate your debt and then continue to overspend. You may consider closing the credit card accounts you have paid off with the consolidation loan.
* Extended repayment period - Most modular home debt consolidation loans extend the repayment period of your smaller consumer loans. So while the monthly payments and interest might be lower, you might end up paying more in the long run. The repayment period can be shortened, however, by making extra payments (in addition to the scheduled monthly mortgage payments) to reduce the modular home loan balance.
* Home equity depletion - Using the equity from your modular home to consolidate your debt can deplete home equity assets that could be used to cover true emergencies in the future. It's important to use debt consolidation responsibly so you're not left without assets when you really need the money.
The relative benefits of a modular home consolidation loan may vary over time and will depend on individual circumstances. The longer the modular home and/or loan are kept at the new lower rate and term, the more interest savings can be realized when compared to your current situation. The repayment period of a modular home mortgage loan can generally be shortened when additional funds above scheduled monthly mortgage payments are consistently paid and applied to reduce the loan balance.
A4) Shopping For a Modular Home Refinance Mortgage - Modular home owners living in modular home parks, on leased land or in other instances where the modular home is not attached to real property, are forced to look to the internet for lending sources, as most local banks, credit unions and mortgage brokers normally do not finance or refinance modular homes by themselves. This type of loan is called a "Chattel Mortgage" and/or a personal property loan. Before you even think about applying or shopping for a modular home refinance mortgage, gather the following items:
1) Know the year, make, model and size of your modular home. Many consumers know the make of their modular home, but not the model name. The model name is a crucial factor to the value associated with the modular home. Just like cars, modular homes have a make & model name. To make the point, we all know the Chevrolet is a brand of car. They make very inexpensive cars and very expensive luxury cars such as the Corvette. To find the model name, it may be necessary to call the modular home dealership you purchased the modular home from or possibly the modular home builder that built the modular home. The next most important factor is the size of the modular home. Never guess or rely on documentation, measure your modular home for accuracy.
2) Know Your Current Mortgage Balance . Once again, many consumers guess at their balance which when shopping for a refinance mortgage can skew your possible savings. Call your current mortgage lender, and ask for a 30 day payoff. This will give you accurate information to make a well informed decision. If you are consolidating debt, add up the items you wish to consolidate or know the amount of cash back you are requesting.
3) Have Your Credit Scores Available - Due to recent changes in the Fair Credit Reporting Act, most consumers can now go online and receive a free credit report and for a few dollars get their current credit score. JCF Lending Group, along with the bulk of the industry lenders rely on Equifax Credit, however, it might be a wise idea to be armed with all of your credit scores. You can access them at the following links, Equifax, Experian and Trans Union. By knowing your scores, you will be able to receive accurate rate & payment quotes, without jeopardizing your credit score. Having your credit run repeatedly, contrary to popular belief, can drastically reduce your score.
4) Things to Remember When Shopping For a Mortgage Online - As mentioned above, you should now have the make, model, year and size of your modular home. You should also know your credit scores, along with the balance on your existing mortgage. It's time to shop, but we recommend the following:
A) Avoid websites That Do Not Provide Contact & Company Address Information - Most websites that do not provide contact information are actually lead sellers or worse yet, are in the business of selling your personal information. Internet fraud is at an all time high. Never provide your personal information to an unknown source. If your only contact method is email, wisely use caution.
B) Always Avoid Websites That Promise Multiple Quotes - The bulk of these sites sell your information to mortgage brokers and to anyone else that will pay for your information. As a result, most consumers will be bombarded at home and at work by real estate mortgage brokers, who 9 times out of 10, do not lend on modular homes. It is also quite common to receive calls and emails from credit repair and credit counseling firms. We have heard of consumers receiving hundreds of calls at all hours of the day and night, lasting for months after the actual inquiry.
C) Get The Complete Details of Your Approval or Offer - When comparing loan approvals or offers, you need to compare the complete details of said such approval and/or offer. Never simply be satisfied with a rate and payment. Find out the particulars of the approval and/or offer. Ask for a break down of all fees, including the cost of the appraisal or inspection. Make sure all quotes and/or approvals have the same starting figure, which is: A) The amount paid to your existing lien holder. B) The amount paid to your existing lien holder, plus any debt consolidation and/or cash you may wish to receive (if applicable). C) The amount of Cash you are receiving on a clear title. All approvals should be clearly laid out and easily understandable. Here is an example of a loan approval that is provided by JCF Lending Group. The approval should also contain any conditions and/or stipulations needed.
EXAMPLE APPROVAL/OFFER
Lien Holder Payoff: |
$100,000.00 |
Cash to Customer: |
$20,000,00 |
Base to Finance: |
$120,000.00 |
Doc Prep/Escrow fee: |
299.00 |
Federal Flood Certification: |
$12.00 |
State Titling fee: |
$20.00 |
Loan/ Origination Fee: |
$1,200.00 |
Total to Finance: |
$121,153.00 |
Term of Loan/Mortgage: |
240 Months |
Actual Interest Rate: |
6.99% |
Annual Percentage Rate (APR): |
7.134% |
Monthly Payment: |
$938.57 |
Q: How Long does it take to get Approved
for a Modular Home Refinance Loan?
A: If you apply by
phone, we can normally get an approval to you in 15 minutes. If you
apply online, normally 24-48 hours. Some applications may take
slightly longer in cases where additional information is needed. If
more information is needed, you will be contacted either by phone
or email. If you need an answer fast, simply call us at (866) 967-0143. The approval you receive will be valid for 60 days and
the rate cannot change in that time period.
Q: What States Do You Offer Modular Home
Refinance Loans in?
A: We offer modular home refinancing in the following States:
ALABAMA, ARIZONA, ARKANSAS, CALIFORNIA,
COLORADO, DELAWARE, FLORIDA, GEORGIA, ILLINOIS, INDIANA, IOWA,
KANSAS, KENTUCKY, LOUISIANA, MARYLAND, MICHIGAN, MINNESOTA,
MISSISSIPPI, MISSOURI, MONTANA, NEBRASKA, NEW MEXICO, NEW
YORK, NORTH CAROLINA, NORTH DAKOTA, OHIO, OKLAHOMA, OREGON,
PENNSYLVANIA, SOUTH CAROLINA, SOUTH DAKOTA, TENNESSEE, TEXAS, UTAH,
VIRGINIA, WASHINGTON, WEST VIRGINIA, WISCONSIN and
WYOMING.
Q: What Types of Mobile Homes Qualify for
Refinancing?
A: JCF Lending Group
refinances mobile homes, modular homes and park "RV" models. We can refinance single
and multi-section mobile homes as follows: single section modular homes can be no
older than 20 years. Multi-Section modular homes can be no older than 1977,
with the exception of California, where the multi-section modular homes can
be 1970 & newer. All modular homes must be in good condition, and must
not need major repair, to include roofing, skirting, siding and
carpeting. Modular homes can be located in modular home
parks, on owned or leased land, or on private or family land.
Q: Are there any Fees associated with
Applying for a Modular Home Refinance Loan?
A: No, JCF Lending
Group does not charge an application fee. There may, however, be
fees associated with the modular home loan program that you
choose. Once you are approved, your loan representative will go
over all fees that will be financed into your new modular home loan.
The only out of pocket expense would be the cost of an appraisal
and/or inspection. If the modular home is in a leased lot community, either
an inspection or appraisal would be required. Your loan officer
will let you know which you will need for the refinance. If your
modular home is on leased, rented, owned or family land, only an inspection
will be required in order to determine the value. If the modular home is
located in a California modular home park, an appraisal is almost
always required and recommended to determine the true value of your
modular home.
Q: Is an Appraisal Required For A Modular Home Refinance Loan?
A: An appraisal may or
may not be required, depending on the NADA book value of the modular home
and the amount you want to finance. An inspection is always required on every transaction. An inspection will give the overall
condition of the modular home, and additional options of the modular home, such as
decking, awnings, garages, etc. If we have enough value booking the
modular home out using the inspection, an appraisal is not required. An
appraisal is required is we do not have the value using the above
method. Appraisals take into account recent sales from the same
community, and surrounding area, community adjustments, and
location to determine the value. An appraisal is almost always
needed and recommended in the State of California. There are a
handful of other states where an appraisal is required. Contact a
JCF customer service representative for more information.
Q: How long is the entire Modular Home Loan
Process?
A: Modular home
refinance loans normally take up to 2 weeks. Keeping the
communication channels open with your loan officer can normally
always expedite the loan process. Your loan officer will provide
you with a list of items, called stipulations, that we will need
you to fax or email to us. Once we have these items and your
appraisal/inspection has been completed and cleared, we will be
ready to send your loan documents to be signed and returned.
Q: Does JCF Offer Land & Modular
Home Refinancing?
A: No. JCF Lending
Group is a modular home only lender. If there is land or
acreage involved in your transaction, we are not the lender for
you. JCF is not licensed to finance or refinance land or the
combination of land and modular home. We can only refinance
the modular home when it has not been deeded together with land. Most of
our customers live in modular home parks,
communities or rented or family land situations.
Q: What are the Advantages of Refinancing
my Modular Home?
A: There are several
advantages to refinancing your modular home. A lower interest
rate will save you money each and every month, as well as over the
long term of the loan. Another advantage would be to shorten the
term of your loan at a lower interest rate. The savings over the
life of the loan are significant. JCF Lending Group can also offer
a cash out or consolidation refinance provided your modular home is located
in a modular home park or community. Take out cash
from the equity in your modular home to do some home improvements, or do a
consolidation loan to pay off those high interest credit cards.
Q: I have a Clear Title on My Modular Home. Can I
Borrow Against it?
A: Yes, this would
still be considered a refinance type loan and your modular home would be
used as security. However, this program is only available for modular homes
located in parks or communities, and the modular home must be 15 years and newer. You can use
the cash for any purpose, consolidate credit cards, home
improvements, vacation, or even tuition.
Q: My Modular Home is in a Park and/or on
Leased Land. Can You Help?
A: Yes. JCF
specializes in this type of modular home refinance and/or
loan. In fact, this is what the name of our URL
(www.chattelmortgage.net) means, a loan for a modular home not attached to
property by way of deed or title. We offer the lowest rate &
fee combination Nationwide.
Q: My Modular Home is in a Co-Op park
where You Own the Land. Can you refinance this?
A: No, not at this
time. Co-Op parks are not considered real property and they are not
considered personal property or Chattel, the correct term. In a
Co-Op park, each owner buys a share. The share gives them ownership
of a percentage of the park, including the roads and common areas.
The land sitting under a modular home in a Co-Op park is not owned by the
modular home owner, but rather all share holders in the park. So, for
example, if the park has 300 modular homes, the ownership of the park is
divided up into 300 shares. Our type personal property loans,
commonly called Chattel Mortgages, have foreclosure solutions that
consist of selling the modular home at it's current location or moving the
modular home out of the park or from its current location. Because of the
multiple owners of the land, we would need each shareholder's
permission to accomplish this, which is not feasible. There are
proposed law changes that may open Co-Op parks to personal property
loans in the near future.
Q: I live on an Indian Reservation. Can I
Refinance my Modular Home?
A: No, not at this
time. Indian Reservations are unique as the true ownership of the
land is the Tribe, similar to a Co-Op park. As the tribe grants you
land, they retain the ultimate ownership of that land and access to
the reservation. In the past, we have made loans in reservations
with the agreement of the tribal counsel that we could enter the
reservation and/or property in the event of default. We have found
that a decision by the current tribal counsel can be overridden by
a future counsel, making our previous agreement null and void,
leaving us without the right of repossession in the event of
default.
Q: What is the Minimal Amount you will
Finance, and what are your Terms?
A: Our minimum amount
to finance is $20,000 Nationwide, with the exception of California,
which is $30,000. Exceptions to our minimum to finance can be made
on a case by case basis. There is no maximum amount to finance. Our
terms range from 7 - 25 years, with the following basic guidelines.
Our terms are dependent on the amount financed. Typically, for
balances less than $40,000, we can provide a maximum term of 15
years. If the balance exceeds $40,000, we can offer a maximum term
of 20 years. Exceptions can be made on the term on a case by case
basis. Our California Pre-Hud program, which is mobile homes built from
1970 - 1975, caps the term at 15 years. No exceptions can be made
on this regardless of the balance.
Q: Is Escrow required in order to Close a
Modular Home Loan?
A: Escrow is not
required in any state, with the exception of California, where it
is mandated by law. Escrow in California is handled by a third
party escrow company. JCF Lending Group has friendly relationships
with several escrow companies, and we will find one near you. In
all other states, escrow is handled internally by our office, where
we do all functions from titling the modular home, to cutting checks to
your current lender, credit card companies, other banks, and even
to you.
Q: When is a Modular Home Refinance Not
Advisable?
A: If you are planning
on selling your modular home in the near future, a refinance loan may not
be advisable to you as there are mandatory fees involved in every
transaction that may out weigh the benefits of a refinance loan.
To consider the pros or cons of refinancing your modular home,
there are two formulas to apply depending on your goal in regards
to refinancing. If your goal is monthly savings, add all fees
charged for the modular home refinance loan, and divide your monthly
savings into this figure. Example: Loan origination cost $1,500,
divided by say $150 per month saved. This would mean that you would
have to be in the modular home 10 months before breaking even and actually
see the savings per month. The other formula is quite simple,
multiply your remaining months on your loan by your current house
payment, do the same for the new loan. Now, subtract your old loan
from your new loan. This will tell you your net overall savings. It
is important to point out that this figure represents overall
savings.
TIPS ON BUYING A USED MODULAR HOME
Q: How to Determine What the Modular Home is
Worth?
A: There are several ways to determine this. It is not an
easy question, as there are many variables. We also want to point
out that many people believe that because a modular home is listed with a
realtor, that the asking price must be an accurate determination of
the market value. In many cases this is false. The realtor simply
listed the modular home with no regard to market value or to comparable
modular home sales. Below we have outlined ways of determining the correct
market value.
A1) Modular Home is Located in a
Modular Home Park- When
the modular home is located in a leased lot community, the best way to
determine the true market value is to determine what other similar
modular homes have sold for in the last Six (6) months within that park or
community. Many parks and communities have extremely high location
and/or community values. The selling price in these communities is
dictated by supply and demand. Here are some ways of determining
value. We have limited our answers to personal property situations,
as we do not finance real property and/or land.
A1a) Park / Community Manager - Make an appointment with this person to
discuss recent modular home sales within the park or community. You are
looking for similar modular home sales, comparable to the modular home you wish to
buy. Keep in mind that modular home sales within the last Six (6) months are
always preferable. When looking at previous modular home sales, make sure
the modular homes that you are comparing are equal in year, size and modular home
sections. If you are buying a single wide modular home, for example, you
would not compare double wide modular homes in your value
determination.
A1b) Appraisal - If done by a trained
modular home appraiser, this is your best option. The
appraisal considers the quality of the modular home builder, year and
square footage in comparison with other comparable modular homes within a
given park or community. An appraisal does not consider upgrades or
unusual value items. The appraisal should be considered the true
market value and carries the most weight in value determination.
You may also wish to get an independent NADA Advanced Book Value,
which will indicate just the modular homes value, helping you determine how
much you are paying for community/location value. Note, if you will
be financing your modular home with a lender, check with that lender for
their approved appraiser list.
A1c) Book Value - The N.A.D.A. Advanced
Book Value is a value taken from a book. There used to be several
"books" or "guides" that were used to evaluate the value of a modular
home, but now there is just one nationally recognized, the N.A.D.A.
Manufactured Housing Appraisal Guide. As N.A.D.A still prints this
book, professional users are provided with advanced software that
is regularly updated to reflect current value trends. The book
value considers State Location, Home Life Span, Condition, Quality
and items in need of repair. The book value also adds for
additional items such as garages, septic tanks, decks, water wells,
etc. It does not consider the value of the land or supply and
demand for the modular home. Only the Advanced version gives a realistic
picture of the modular homes value, not to be confused with online services
that ask only a handful of questions. Note, if you will be
financing your modular home with a lender, they may require an appraisal in
combination with the Advanced Book Value Report.
A2) Modular Home is Located on
Leased, Family or Friends Land - In this case, the land or
community value can not be considered in the value determination of
the modular home. Only the N.A.D.A. book value should
be used when determining value in these situations. Because the
modular home is not in a park or leased lot community, Fair Housing Laws
are not applicable to modular homes in these situations. modular homeowners are
normally not under the same protection laws afforded to modular homeowners
in parks and communities. This should be a major consideration when
determining the value and/or the amount to offer on a modular home under
these conditions. Remember, that at any time the land owner can
demand the modular home be moved, which will greatly affect the modular homes
value. The current average approximate cost to tear down, move, and
re-set up a single wide modular home is $4,000.00, that is if the modular home is
moved 5 miles or less. When the modular home is a multi-section home, the
average cost jumps to $10,000.00. These costs do not include the
multiple fees paid to the county for trip permits, escorts, or
multiple inspections that will be required before you can once
again reside in the modular home.
A3) Buying a Modular Home That Will
Be Moved - Only the N.A.D.A. book value should be used when
determining value in these situations. If the buyer will be
financially responsible for moving the modular home, only the Wholesale
Value should be considered. The wholesale value adjusts the value
for tear down, transport, lot set-up, redelivery, re-set-up
and retailer profit, where a modular home is purchased by a dealer and is
offering the modular home for sale at a sales location or other site
location. We must stress that the wholesale value may not reflect
the true cost of transportation in your situation. Always get
several bids on the complete cost of tear down, re-setup and
transportation of the modular home prior to making a written purchase
agreement on any modular home that will be moved at your expense. In many
cases, the cost of moving a modular home may negate the modular homes value. Also
keep in mind, that modular homes that have set in one location for a long
period of time, many times, will have doors and windows that will
never open or close properly in the future, once
moved.
Q: How to Choose a
Realtor/Dealer?
A: Depending on your
area, most consumers will need to choose between using a realtor or
modular home dealer to find the right modular home for them. In most States,
realtors who sell modular homes must also be
licensed dealers, but the contrast between the two could not be
greater and there are advantages and disadvantages from both
dealers and realtors.
Dealers - just list and sell modular homes, as a rule. Most
consumers will be better off choosing a dealer, as the dealer
should be able to show you multiple modular homes that meet
your needs. They will also know the sources of financing available
and should know valuable information about the park or community,
if this is applicable. A dealer does not sell stick built homes or
real property, strictly modular homes, normally
in a park or in a leased lot community. When choosing a dealer,
reputation & character are everything. Don't be afraid to ask
around, make sure that you can trust this dealer with the most
important purchase of your life, your home. The downside of using a
dealer is that they normally only sell their own listings. Very few
have access to a multiple listing service, as dealers tend to not
cooperate with realtors.
Realtors - can sell both stick built homes and modular homes.
Most realtors avoid modular homes, as the commission on a
stick built home is much greater than that of a modular home. Most realtors will reluctantly show a modular home, normally only when pursued by a consumer on a
limited budget, if this is an issue. Larger Realtor offices may
have a department or person that specializes in modular homes, which can be viewed very positively. In many
cases, the new agent or "Newbie" in the office gets the consumer
looking for a modular home. This person knows little
about real estate and even less about the special needs of a modular
home buyer or our specialized industry. The
positive feature of using a realtor is that they normally have
access to a multiple listing service, allowing the consumer access
to multiple listings from different
offices.
Finally, experience should be your goal when choosing either a
dealer or realtor, as an experienced salesperson can make the
purchase a pleasure or an inexperienced salesperson could turn
your purchase into a nightmare. Below are warning signs for salespeople to possibly avoid.
*Tells you that you will be charged a buyer fee for their
service.
* Asks you for a pre-qualification letter before he or she will
show you a modular home.
* States that he or she has never sold a modular
home.
* Tells you to seek out your own financing.
* Gives you the name of a broker or lender that does not lend on
modular homes.
* Wants to write up an offer on real property forms.
* Opens escrow or talks about the modular home closing in escrow. (Except
California)
* Orders an appraisal with a real property appraiser.
* Orders an appraisal without having a loan approval.
* Hard to contact, consistent voice mail, always unavailable.
* Can't tell you the make, model or size of the modular home.
* Cannot answer simple questions regarding modular
homes.
* You know more than they do about modular
homes.
Q: Which Modular Home is Right for
Me?
A: This all depends on you, and what
your needs are. You want a modular home that is large enough to accommodate
you, your family, and your possessions. If, for example, you are
retired, and travel a lot, you would not want a large double or
triple wide. You might opt for a single wide because of the smaller
square footage and lower heating or cooling bills when you are not
present. If you are a couple with plans of starting a family, or
already have a family, you should choose a larger modular home, such as a
double or triple wide, to accommodate your growing family and your
need for room. Whichever the case, you want to make sure you choose
a modular home that is structurally sound, has the amenities
that you desire, a community that is attractive, and a friendly
neighborhood. If you have children, you will also want to live in a
school district you prefer, and is close to your job. It would not
be in your best interest to find a "fixer upper", as this often
leads to frustration and extensive out of pocket expenses. It is
better to purchase a modular home, that even though it may be a little more
expensive, is not in need of major
repairs.
Q: How do I get the Best
Deal on a Used Modular Home?
A: First of all, know
what you can afford. A Realtor or Dealer will try to put you in a
modular home that may be above what you want to spend monthly on housing,
so they can get a higher commission. You need to stick to your guns
on what you want to pay. A common mistake modular home buyers make is
thinking the sales price in set in stone. This is not the case. The
market sets the price, not the seller. For example, a seller bought
their modular home when the market was hot for $80,000. Two years
later, they think the modular home is worth $100,000, but because of
changes in the market, it may only be worth $85,000. This is a
bargaining tool for the buyer. Do not be afraid to make a low ball
counter offer. The seller will come back with another counteroffer,
and it goes back and forth. Do not wait until you have to move or
are being transferred by your job before looking for a modular home. You
will more than likely make a rash decision and pay more than you
want to because you are in a time crunch. Another tip is the time
of year you choose. Summer time is the most popular time to move,
and prices may be higher during this season, because more people
are looking to move, and possibly making offers on the same modular home
you are looking at. If you wait until the winter months, you are
more than likely to get a better deal on a modular home. If an appraisal is
ordered, this is another bargaining chip. Say the sales price of a
modular home is $60,000, and the modular home appraises at $55,000, you now have a
foot to stand on in when making a counteroffer. No seller can
dispute what is in black and white in front of them.
Q: What if there are Items in The Modular Home that Need to Be Repaired?
A: Many modular
home purchase agreements are drawn up showing the modular home sold "as
is". This means that the seller is more than likely aware of items
that may be in need of repair, but has not agreed to have these
things fixed. It is in your best interest to get in contact with at
least 2 different contractors to get an estimate on what the
repairs would cost. If the repairs are extensive, your agent or
realtor should contact the listing agent to see if the seller will
complete the repairs or reduce the price of the modular home to cover the
cost of the repairs. If this is not acceptable to the seller, you
should find another modular home to purchase. The last thing you want to do
is spend money on your investment, only to have to spend countless
more dollars fixing up your modular home to make it structurally sound and
livable. There may be a modular home right down the street, or around the
corner, in the same price range, that is not in need of
repairs.
Q: I Found a Modular Home. What's
Next?
A: You will need to
make an offer on the modular home. If you have a real estate agent, they
will assist you with this, and the offer should contain the
following items: a complete legal description of the property, the
amount of earnest money, your down payment and finance details, the
price you are offering, your proposed closing date and move-in
date, the length of time the offer is valid, and any other details
of the transaction, such as if appliances are included in the sale,
etc. If an appraisal/inspection will be required, always make the
offer contingent on a favorable outcome of either an appraisal or
inspection of the modular home.
You should take your time when
making an offer on the modular home. There are several factors to consider
such as what modular homes sell for in the area, the modular home's condition, how
long it's been on the market, financing terms, and the seller's
situation, and what you can afford. Be prepared to go back and
forth between yourself and the seller on the final sales price.
Once a price is agreed on, you should be prepared to put down
earnest money. This shows the seller you are serious about
purchasing their modular home. The earnest money should be
between 1% - 5% of the sales price. If your offer is accepted, the
earnest money will become part of your down payment or closing
costs. If the final offer is rejected by the seller, the earnest
money will be returned to you. If you decide to back out of the
deal, you may forfeit the earnest money completely. Make sure the
earnest money deposit is addressed in writing in the
offer.
DOCUMENT & LOAN LAYOUT QUESTIONS
Q: How Long Are Your Loan Approvals Good For?
A: All modular home loan approvals are good for 60 days from the approval date. This means that during this 60 day period, your rate and term cannot change. After the 60 days have expired, your loan will need to be re-approved and is subject to the current rates and guidelines at that time. Remember the rate & term contained in your approval are conditioned upon meeting the terms of said such approval.
Q: Do Your Modular Home Loans Carry Any Pre-Payment Penalties?
A: No, the modular home loans offered by JCF Lending Group, are free from any and all pre-payment penalties. However, items that are financed into your loan such as insurance, titling fees, escrow fees and/or any closing costs are non-refundable and paying your loan off early will not affect the cost of those items. We require all regular and/or scheduled payments to be made by automatic withdrawal. All payments that you wish directed at the principal balance will need to mailed in to avoid confusion.
Q: Why is My APR Rate Different from My Loan Rate?
A: Annual Percentage Rate (APR) is the equivalent interest rate considering all the added costs to a given loan. Depending on your State and applicable fees, this can include escrow fees, titling fees, loan fee or any other fee that is paid for up front or that is financed into your new loan. Naturally, it is a function of the loan amount, the interest rate, the total added cost, and the terms. The APR would equal the interest rate if there were no additional costs to a given loan. Here is an example:
Total money borrowed:
(The actual amount of money you are going to receive from JCF Lending Group.) |
$200,000.00 |
Total extra cost:
(Escrow fee, loan fee, title fee, and so on.) |
$1,500.00 |
Interest rate: |
6.74% |
Term: |
20 years |
Now, since you are only borrowing $200,000 but paying $1,530.94/month for 20 years, we can back-calculate the equivalent interest rate (APR) by using the Loan Calculator Scenario #2. The answer is,