Manufactured home financing works differently from a regular home mortgage, and the difference starts with how the home is titled. In Texas, a manufactured home on land you own can be converted to real property and financed with a mortgage. A home in a leased-lot community, or one you'd rather keep titled like a vehicle, is personal property and is financed with a chattel loan. Same home, two completely different loans — different rates, different terms, different paperwork. This guide walks through both paths, the government programs that help, what lenders look for in your credit, and the insurance you'll carry either way. (This is education, not financial advice — your lender's numbers are the ones that count.)
Chattel loan vs mortgage: what's the difference?
A chattel loan finances the home alone, as personal property. It's how most manufactured homes in America are financed. A mortgage finances the home and the land together, as real estate. Side by side:
| Feature | Chattel loan | Mortgage |
|---|---|---|
| What it covers | Home only | Home + land |
| Title status | Personal property | Real property (via Statement of Ownership) |
| Interest rate | Higher — often several points above mortgage rates | Lower — near standard mortgage rates |
| Term | Usually 15–25 years | Up to 30 years |
| Closing costs | Lower, faster closing | Higher — appraisal, title work, survey |
| Works on leased land | Yes | No |
Neither is "better" across the board. A chattel loan closes in days and doesn't need a foundation upgrade; a mortgage costs less per month over decades. The math tilts toward a mortgage the longer you plan to stay and the more the land is worth.
Which government programs help with manufactured homes?
- FHA Title I — insures loans on the home alone, even on leased land. Loan limits were raised substantially in 2024 and now adjust with the market, which brought the program back to life for real-world home prices.
- FHA Title II — the standard FHA mortgage, available when the home is real property on a permanent foundation. Down payments start at 3.5% for qualifying credit.
- VA loans — eligible veterans and service members can finance a manufactured home, with the best terms when home and land close together as real estate.
- USDA loans — for qualifying rural areas (much of the countryside around San Antonio counts), USDA programs can finance new manufactured homes with no down payment for income-eligible buyers.
Each program has its own home-age, foundation, and occupancy rules — for example, most require the home to be your primary residence, and some only finance homes that have never been moved from their first site.
What about conventional loans?
Fannie Mae's MH Advantage and Freddie Mac's CHOICEHome programs give near-site-built mortgage terms to newer manufactured homes that carry specific design features (higher roof pitch, drywall, dormers or porches — the home gets a special tag from the factory). Standard conventional loans also work for real-property manufactured homes at many Texas banks and credit unions. If you're buying new, ask whether the floor plan you like qualifies — it can be worth a meaningful rate difference.
What credit score do you need?
Rough 2026 expectations across the industry: FHA programs work down to the low 600s (sometimes 580 with a larger down payment), conventional programs want mid-600s and up, and chattel lenders write loans across a wide band — often down to around 575 to 600 — with rate and down payment scaling to the score. Below that band, options thin out but don't vanish: larger down payments, co-signers, and owner financing all exist for a reason.
What helps more than buyers expect: twelve months of clean rent and utility history, a steady two-year job record, and a down payment above the minimum. What hurts more than expected: recent late payments, even small ones, and maxed-out credit cards on the application date.
What is owner financing?
Owner financing (or seller financing) means the seller — often a dealer — carries the loan instead of a bank. It's common in the Texas manufactured home world, especially on used and repo homes, and it can put a home within reach when a low credit score closes the bank route. Under federal and Texas rules, sellers who finance must follow real lending law: written terms, disclosed rates, and proper titling.
Read the numbers carefully. Rates run higher than bank loans, and the total cost over the term is what matters — not just whether the monthly payment fits. Ask for the full amortization, in writing, before signing anything.
How does insurance work on a manufactured home?
Manufactured homes carry their own policy type — usually written as an HO-7 or a specialty manufactured home policy — covering the structure, your belongings, and liability, much like ordinary homeowners insurance. In Texas, annual premiums often land between $800 and $2,000, driven by the home's value and age, your county, and your deductibles. Coastal counties pay more and typically add separate windstorm coverage; in the San Antonio area, hail is the claim we hear about most.
Every lender — chattel or mortgage — requires coverage for the loan's life. Two buyer tips: insure to replacement cost rather than market value if you can (an older home's market price won't rebuild it), and ask how the policy handles the home during transport and installation if you're buying new — the delivery step in Part 5 is a gap in some policies.
What paperwork should you have ready?
Loan files on manufactured homes stall over documents more than credit. Have these lined up:
- Two years of income history — W-2s, or full tax returns if self-employed
- Recent pay stubs and bank statements
- Photo ID and Social Security numbers for every borrower
- For used homes: the home's HUD label or serial number, so the lender can pull its record (Part 2 shows where those live)
- For land deals: the survey, deed, or land contract
After closing, Texas adds one step lots of buyers miss: the Statement of Ownership filed with TDHCA, which records the new owner, any lien, and the personal-vs-real-property election. The retailer or lender usually files it, but the deadline (within 60 days of sale) is ultimately the buyer's — confirm it happened. It's the document every future sale, refinance, or insurance claim leans on.
Frequently asked questions
Can I get a 30-year loan on a manufactured home?
Yes, when the home is financed as real property — FHA Title II, VA, USDA, and conventional programs all reach 30 years. Chattel loans typically top out around 25.
What credit score do I need to buy a manufactured home in Texas?
Many chattel lenders work down to roughly 575–600, FHA to the low 600s, and conventional programs from the mid-600s up. Below those bands, larger down payments and owner financing keep the door open.
Is a down payment required?
Almost always, though the size varies widely — from USDA's zero-down program for eligible rural buyers, to 3.5% on FHA, to 5–20% on chattel loans depending on credit. Land equity can sometimes serve as the down payment on a land-home deal.
Does financing work on older used homes?
It gets harder with age. Many lenders set cutoffs (commonly 15–25 years old), and pre-1976 mobile homes are outside nearly every program. Owner financing and cash dominate the oldest end of the market.
Is insurance required by law in Texas?
No state law requires it on a paid-off home — but every lender requires it during the loan, and going bare on your largest asset is a gamble no one at our lot would recommend, in hail country least of all.