How mobile home loans work
A mobile, manufactured or park home is often financed with a loan secured on the home itself rather than on land. These are sometimes called chattel loans. Because the home can be moved and may lose value over time, lenders often charge more and lend over shorter terms than for a standard mortgage.
If you own the land the home sits on, a mortgage that covers both may be possible. Ask lenders which options fit your home.
Worked example
An £80,000 mobile home with a £10,000 deposit means borrowing £70,000. At 9% over 15 years, the payment is £709.99 a month, £127,797.59 in total, so £57,797.59 is interest.
A £20,000 deposit cuts the payment to £608.56 and the interest to £49,540.79. Repaying the £70,000 over 10 years raises the payment to £886.73 but cuts the interest to £36,407.65.
Interest is worked out monthly at one twelfth of the annual rate. Lenders may calculate interest differently (some charge it daily), so your actual payments can differ slightly.
Running costs
Budget for site or pitch fees, insurance, utilities and upkeep on top of the loan. Check the site agreement too, as it can affect selling the home later.
Inputs for the mobile home loan calculator
Mobile home price
The price of the mobile or park home.
Deposit
What you're paying upfront. A bigger deposit means borrowing less and paying less interest.
Interest rate (per year)
The annual interest rate on your loan. The rate shown is only an example, so enter the rate from your quote.
Term
How many years you'll repay over.
CALCULATOR QUESTIONS
Mobile home loan calculator questions
Can I get a mortgage on a mobile home?
Often not a standard one. Many mobile homes are financed with a loan secured on the home itself, unless you also own the land.
Why are mobile home loan rates often higher?
The home can be moved and may lose value, so lenders see more risk than with bricks-and-mortar property.
Does a bigger deposit help?
Yes. In the example, £10,000 more deposit saves £8,256.80 of interest.
Does this include site fees?
No. Pitch or site fees, insurance and upkeep are extra.