To build and live in your perfect modular home, you first need to finance it. The process of buying a modular home is often unclear, with traditional “stick building” or resale as the more familiar choices. Many believe that modular home financing is more complicated than financing for site-built or existing homes — which is not the case.
The process of financing a modular home is quite similar to the traditional loan process, with a few key differences. That’s why we’ve created this guide to help you learn more about the process of buying a modular home and how Design. Build. Modular. will help.
How to Finance a Modular Home
Modular home financing is one of the many steps in the process of securing your dream home. Though the process has many similarities to traditional home loans, one of the biggest perks is that you’ll spend less in the long run while still enjoying a beautiful, custom home.
One of the differences between financing for a modular home and a stick-built home is that building a modular home requires you to have the means to fund the project before it begins. As the work on your modular home is completed, you’ll make periodic payments to support the building process, including material and labor costs.
Paying for your modular home throughout the building process is beneficial for both you and the builder, as it protects both parties if one party is unable to complete the project.
Another difference with making payments is which parties will receive the money. With each payment for a modular home, the money will be going to multiple parties — like the builder and general contractor — as well as funding other necessary items like buying the lot.
Construction to Permanent Loans
When you begin making payments during the construction of your modular home, you may take out a construction loan, which is a short-term loan designed to make these payments. When your modular home is complete, it will go through a final appraisal. After that, your construction loan will transform into a permanent mortgage.
Loans to build a traditional home come with lengthier steps than the loan process for a modular home. The two-stage loan — construction to mortgage — streamlines the process since you won’t need to apply for a mortgage separately.
Contact Design. Build. Modular. to Start Building Your Dream Home
Your home is a place where you’ll make memories for years to come. Design. Build. Modular. is here to help. Our team has more than 100 years of collective building experience, and we’re passionate about what we do. We’ll guide you through every step of the process.
We always start with a consultation, during which we can discuss your budget needs and craft the plan that’s right for you. We’ll even help you get pre-qualified for financing. Becoming a homeowner — and enjoying the perfect home for your family — has never been so simple.
Ready to start the process? We’re here to help. Just fill out our contact form online to get started. You can also call us at our Bethel, CT, office at 203-828-1075 or our Charlestown, MA, office at 617-941-4891.