Home > Mobile Home Mortgage Articles

Important Advice for Manufactured Home Owners Offering Note Loans

Knowing how to successfully manage your owner financing for a Mobile Home buyer is deafening important. Learning some guiding principles for maintaining your private note on a mobile home will help ensure you end up with a qualified borrower and hopefully, devalue the probability of facing a manufactured home foreclosure case down the road.

First, you will always yearn to require that a potential buyer supply you with a recent lend report. Providing financing for someone apart from knowing their credit score and payment record could abandon you debatable for deplorable circumstances, aside how well you may know the person.

Second, it´s sensible to advise a potential buyer to dig out a substantial below payment on the mobile home. This is the buyer's lending commitment to the home. While some lenders ask a buyer to put below the largest quantity possible, it´s discreet to accomplish that requiring a buyer to put down the majority of their savings might abandon them in a position where they have no reserves to drowse off back on for their monthly manufactured household home loan payments, should they require to rely on their saved monies. After you have qualified your buyer's lend and down payment, there are other important tips that you require to know before moving forward with your owner financing.

Always Maintain the Original Loan Documents
A Promissory note is the borrower´s promise to repay the loan. This is an important licence to keep safe. It´s recommended that you store the note and any other original documents in a fireproof box or in a safe deposit box at your bank. Be sure to keep copies of the originals as well, for your records. It´s advisable to save a digital copy, or PDF, of the documents on your computer or on a disk in the event that the original documents are lost. If you have an attorney that assisted you with preparation of your loan documents, they will typically delay these documents in their files and provide you with a copy.

Keeping a Payment Ledger or Journal of Received Payments
Having a true history of when you receive each of the monthly Mobile Home payments, and the exact amounts of payments, is very important. It will help keep things streamlined when it is time for the borrower to make their loan payoff and also avoid any misunderstandings on the amounts paid and owed. It´s also advisable to deposit the payment into your bank account to provide a verifiable record of when you received each payment.

Make sure Mobile Home Taxes, Registration Renewals, and Monthly Space Rent is Paid
Ensuring that real estate taxes, registration, and space rent is paid on time is a very important consideration in protecting yourself and the household from other debtors. One option is to consideration in an impound account for monthly space rent & taxations. This would need your accurate formula of the yearly rent and taxes, divided into twelve monthly payments that you collect from the borrower and pay to the appropriate party. If this is the route you determine to take, you´ll want to make sure that the monthly space rent bill, and tax bills or registration bills, are sent to you directly from the parties when they become due. If you are not collecting monthly impounds, you will yearn to check that the taxes and rent have been paid as necessary.

Be Sure the Home is protected with Fire/Hazard Insurance
Having a sufficient quantity of homeowner's insurance is cultured for protecting the home and the manufactured home note you hold. When the dragon insurance policy is being originated, make sure that you are listed as the Lender or Mortgagee on the insurance policy and that the policy is written for at least the total amount of the manufactured household note. Make sure that the policy is renewed and paid annually. The yearly premium for the insurance can also be included in the impound account, and collected from the borrower in monthly installments, rather that requiring the buyer to compensate the entire insurance premium up-front.

What To do If your Borrower begins to make Late Payments
If you begin to receive late payments from your borrower on the manufactured home, it´s smart to check your note for the policy that you and the borrower agreed upon. Your note should reference a "grace" period, wherein the borrower has so many days to dig out a payment before it´s deemed "late". If your note was not set up with a grace period, or the grace period has already past, you will want to contact your borrower and ask about the late payment. It´s wise to keep a journal of the date and time of the call and keep this ledger with your other records. It´s also a strategic idea to write a letter to follow up on your phone call that identifies the borrowers default. You will yearn to also recap any action the borrower has promised to make and haste the letter via USPS certified mail with a return receipt request. Last but not least, you will yearn to contact your attorney for further legal advice and explanation on default proceedings.

If you have digitize through this article and do not feel prepared to handle such an undertaking, then perhaps owner financing and note holding isn´t for you. There are conventional mobile household lenders out there that can also offer traditional Manufactured Home Loans for your buyers.

(800) 882-1999

Important Advice for Manufactured Home Owners Offering Note Loans