Financing is one of the most important factors in the buying process of modular homes. It involves determining the various financial options and allocating them towards the entire aspects of the construction of the homes.
Modular home mortgages are the best option available for homeowners looking for financing their modular home prices. Qualifying and approval by a bank or other financial institution are crucial for securing a modular home mortgage. This involves following some necessary steps that are described in detail below.
Procure the Necessary Documents
Having all the proper documents pertaining to the financial aspects of the home is highly important. When applying for the mortgage, all the information should be correctly written down in the paperwork. Some of the essential documents related to securing the mortgage for modern modular homes are tax returns papers of the previous 2 years, the existing pay stubs, and W-2’s of 2 years.
The details of the assets such as bank statements of the previous 2 months, investment account statements, retirement account statements, and the make and model of the owned vehicles including their estimated resale value. The lists of the debts should also be gathered along the documents such as auto loan, credit card, and personal loan account information.
Prequalifying for Mortgage
Prequalifying for the modular home mortgage is the other major step in securing a mortgage. During this process, the bank or the financial institution provides the buyer with an approximate rate they offer using the information furnished in the above-mentioned documents. In addition, they also present the opportunity to the buyer in determining the rates from different lending institutions. For assisting with this process, buyers can also rely on third-party services that provide such comparisons along with different financing options.
Preapproval is done right after determining a lending institution that offers the best rate. This is a different process than prequalification, as it requires performing hard checks on the credit score of a buyer. Before preapproval, the buyer needs to verify the lender also, as it can result in temporary damages to the credit score.
Obtaining the preapproval letter will further simplify the process of securing the finance for a modular home. This will enable the homebuilder to understand the requirements of the buyer and provides them with all the details necessary to begin construction of the new home.