Many people mistakenly believe that modular homes and manufactured homes are the same. However, there are several significant differences as far as construction and financing are concerned.

Differences in Construction Standards between Mobile, Manufactured, and Modular Homes

Mobile & Manufactured Homes – A mobile home is simply one that had been constructed before the HUD code came into effect in 1976. Since then, mobile homes have been known as manufactured homes. This new construction code required this style of homes to be constructed on a permanent chassis (the load-bearing framework of a home) for the purpose of safe transportation.

Modular Homes – The HUD construction code is not nearly as stringent as the local state codes that that site-built homes and modular homes must be built to.

Financing is Also a Differentiator

Yet another big difference between modular and manufactured homes is the financing aspect. Almost all manufactured homes are financed from the seller or manufacturer or through a relationship that the seller has with a finance company. In many instances, this financing is a higher rate or a flexible rate, or maybe even balloon payment financing. This type of financing is not always advantageous to the buyer.

In the 1990s, financing was competitive for manufactured homes for a variety of reasons:

  • Investors ceased backing this kind of financing, and the manufactured home industry has never recovered as far as the number of home builds completed annually.
  • Second Sale Financing is a type of financing where the original owner resells the home. It’s very competitive with local, regional, and national banks for both site-built homes and modular homes. Manufactured home sellers seem to struggle to find banks that will finance the second sale. 

-Lastly, it is known that modular homes and site-built homes both retain and increase in value over time. At best, the manufactured home might hold its value. But much like cars, they lose value the day they are sold.

Find Out More About Modular Homes

If you’re interested in learning more, here’s everything else you need to know about modular homes. If you’d like to save lots of time and money, and if you’re interested in working with Century Home Builders to build your next modular home, let’s chat!