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Any knowledge on modular housing, financing, etc.?
Hi all - DH and I have been house hunting for a few months now, and he's currently gungho on the idea of buildng. My gut instinct is that the construction market hasn't tanked to the extent the housing market has, so there's no way we'll be able to build something comparable to the homes we've been looking at without going way over budget. Still I agreed to at least consider modular housing but I have TONS of questions and was hoping someone here on TN has been through the process.
- Are the rates for a construction loan the same as a standard RE loan? We have excellent credit and were planning on putting 25% down.
- Is the cost of land as flexible as RE? We have a specific lot we're looking at but it seems pricey to me, but only 1 plot of land in town sold in the last 12 months, so perhaps there's room to negotiate?
- And if you've built modular, any words of advice? We're finding it difficult to even get a ballpark on the base cost of a ~3000sf home, nevermind how much upgrading to wood siding, granite counter tops, hardwood, etc. And how do you make all the design decisions? It's exhausting just thinking about it!
Anyhow any thoughts/advice would be greatly appreciated! Thanks!!
Re: Any knowledge on modular housing, financing, etc.?
Modular home = stick built home but built in a closed factory and shipped to site. It is the same thing as a traditional house, just built in a climate controlled facility.
Manufactured home = doublewide or singlewide trailer. They typically have a distinct look, are attached to wheels and a hitch and are usually set on a slab (although some have the axles removed and have full basements under them).
I'll assume you mean a modular home and not manufactured. Modular homes are no different than a traditional stick built home. There aren't residency restrictions like manufactured homes have (although certain developments can require you to use their builder, so that would pose a problem) and they appreciate just like a regular house. Manufactured home = completely different ball of wax.
Check with lenders and let them know what you want to do. I've been through the modular process, but it was over 10 years ago... I'm sure things are much different now.
I obtained the land through an estate sale, so again, that was a different scenario than what you're looking to do.
The modular home company will be able to help guide you through the design process. They can't give you a quote right off the bat because there are a ton of options. A 3,000 sq ft ranch is different than a 3,000 sq ft 2 or 3 story colonial. Go to a modular sales office, find a floor plan you're interested in, and ask them for a quote for that floor plan with the base options. That'll give you an idea of your cheapest possible scenario. You can build up with options from there.
http://pandce.proboards.com/index.cgi#general
No, they aren't the same as mobile or manufactured homes. Modular homes are basically stick-built in sections inside a factory then later transported to and assembled on your foundation. They are often structurally superior between having to withstand the transportation and not being subject to the same potential weather damage. They have to abide by your town's coding and are financed just like any other new construction. They say it comes out to about 20% cheaper between shorter construction time (i.e., less interest paid during construction) and economies of scale. I live in Fairfield County, CT and there are TONS of high-end modular homes and you can't tell the difference, inside or out. I'm just not sure if they make sense for us.
Not a problem! Have fun and good luck.
http://pandce.proboards.com/index.cgi#general
Thanks for sharing your experience. From what I've heard, you can get construction loans that convert to a standard mortgage upon occupancy and that way you can avoid double closing costs. The downpayment is what concerns me - we were planning on 25% but 35% would wipe out our e-fund and neither of us want to do that. Also it seems like banks might frown upon including the land in the loan, and we certainly don't have property just sitting around in our portfolio!
We'll be talking to someone this weekend as well as looking at a few existing homes. I'll report back if I learn anything that might be useful to anyone else.