Understanding USDA Home Loans and Manufactured Housing

The USDA finances the land and the manufactured home in one loan.

Manufactured home on a nice lotIn this article, we'll give you a comprehensive overview of all the benefits of USDA loans for manufactured homes. We also provide you with a detailed explanation of the process involved in getting a USDA loan.

Manufactured Home Explanation

A manufactured home is a single or multi-width unit that is constructed offsite and transported to the property. It is then attached to a permanent foundation. Manufactured homes must meet certain criteria in order to qualify for a USDA loan.

The USDA guidelines, requires the unit to be larger than 400 square feet, contain two bedrooms, and have a construction date after June 15, 1976. The unit must be transportable, meaning that the unit can be moved without being destroyed.

Before the 15th of June in 1976, residences that were prefabricated were referred to as mobile homes. That was before rules mandated certain safety requirements. Most lenders will not lend on what are, by definition, mobile homes.

Since June 15th, 1976, manufactured homes built after June 15, 1976, are subject to federal safety regulations. The manufactured housing name replaced the mobile home name.

What's included with a manufactured home?

(1) The purchase of a brand-new prefabricated house, as well as the expenses of transportation, a permanent foundation, and installation of the manufactured home, and the acquisition of a suitable site, if the applicant does not already own a suitable site.

(2) The site development work must be appropriately finished in accordance with HUD regulations, as well as state and local government standards, and the requirements of the manufacturer for installation on a permanent foundation.

Site Location

Keep in mine, that the site must be located in an eligible USDA area. Check the site location with the USDA lookup tool.

Manufactured Home Requirements

The home must be new and acquired from an approved dealer or contractor.

Single-wide manufactured houses must be 12 feet wide and have at least 400 square feet. Double wide unit need to be at least 20-foot-wide.

Construction Standards

All Federal Manufactured Home Construction and Safety Standards (FMHCSS) must be met, which specify how the property should be manufactured, assembled, and installed.

Site Location

The home's location must be classified as real property and taxed accordingly. It must also be attached to a stable foundation and placed in a USDA-approved rural location.

The lowest point of the residence should be elevated above the 100-year floodplain, and it should have access to water and wastewater disposal.

Appraisal Considerations

The United States Department of Agriculture (USDA) lenders will require an appraisal of any modular or manufactured property in order to ensure that it satisfies all appropriate standards for financing and to evaluate its current market condition. This is similar to the process that is followed when purchasing a traditional home.

Loan Restrictions

The USDA does not guarantee loans for the following purposes:

  • A unit that retains its tow hitch or running gear.
  • The USDA prohibits additions and changes to new or existing units except for porches, decks, or other structures constructed to engineering designs and inspected and authorized by a local building code authority, 
  • Furniture, which includes moveable personal property such as draperies, beds, bedding, chairs, couches, divans, lamps, tables, TVs, radios, and stereo systems. Furniture excludes wall-to-wall carpeting, refrigerators, stoves, ranges, washing machines, clothes dryers, heating and cooling equipment, and similar items.
  • Manufactured home units manufactured more than 12 months prior to the commencement of the purchase agreement contract.
  • Purchase of a unit that will be relocated from a location other than the manufacturer/dealer lot to the location where the mortgage loan will be secured.
  • Repairs that are not related to a transfer, a Real Estate Owned (REO) sale, or a unit that is already funded via a Section 502 loan.
  • The purchase of a unit without first securing a suitable location.
  • There are no swimming pools or residences located inside 100-year flood zones.

Is the USDA the best loan for a manufactured home?

Best choice graphicLet's take a look at some USDA loan requirements.

No down payment. The FHA requires a 3.5% down payment.

Low guarantee fee of 1%. The FHA charges 2.25% for a similar loan.

There is monthly PMI, but it is less than the FHA mortgage insurance fee.

Homeowners must be under the income cap. Currently, the base limit for 1-4 member households is $103,500. There is no income limit withe FHA.

Rotating question markFAQs About Manufactured Homes

Q. Does the USDA cover the cost of purchasing a manufactured home?

There are a few different types of home loans that can be used to purchase a manufactured home. One option is a USDA loan, which is a government-backed loan.

This type of loan can be helpful if you have low or no credit score, and you want to purchase a manufactured home for use as your primary residence. The loan amount that is available through the USDA varies depending on the specific home purchase that you are making, but it can typically be much larger than other types of home loans.

Q. Can a USDA loan be used to buy land and a manufactured home?

You can buy land and a manufactured home with a USDA loan. The loan program offers several types of loans that can help you purchase the home of your dreams.

There are many lenders that offer these loans, so be sure to research which one is best for you. You can also use a mortgage to help finance the purchase of the home, or you can use a modular home loan to get a more affordable option. Either way, you're guaranteed to have a great experience when purchasing your new home through the USDA loan program.

What type of USDA loan can I get for a manufactured home?

There are many types of loans available for buying a manufactured home. The most common type of loan is a USDA Rural Development Loan. This loan is available to people who live in rural areas and want to buy a new manufactured home. Another type of loan is a USDA Manufactured Home Loan.

This loan is available to people who already own a home and want to buy a new manufactured home. A new manufactured home is a home that has been built after 2006. FHA Loans are also available, but they are not as common as the other two types of loans.

Q. Do manufactured homes have different loan requirements?

Loans for purchasing a manufactured home are different from traditional mortgages. Manufactured homes must be purchased using a loan from a USDA lender. These loans have stricter lending criteria and are not available to everyone.

Rural housing loans are also available, but they have more restrictions than USDA loans. These loans are designed for people who live in rural areas and cannot get a traditional mortgage.


In conclusion, a USDA loan for land and manufactured home can be a great option for many people. It offers a variety of benefits, such as lower interest rates, flexible terms, and no down payment. If you are interested in buying a manufactured home, be sure to check out the USDA loan program.

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Recommended Reading

  1. Check If Your Income Is Too High for a USDA Loan
  2. What Are the USDA Loan Inspection Requirements?
  3. You Can Now Get a USDA Loan for a Manufactured Home