Manufactured Home Closing Costs: What You Pay Beyond the Down Payment
Cash to close on a manufactured home is the down payment plus four other kinds of cost: the fees for setting up the loan, prepaid items such as insurance and interest, charges the community collects if the home sits on leased land, and the cost of moving or setting up the home if it is not already in place. The down payment is covered in its own article, down payments explained; this one is about everything else on the statement.
No two statements carry the same figures, because fees depend on the loan, the home, the county and the community. What stays the same is the shape of the list, and that is what you can prepare for.
Five kinds of cost, and who each is paid to
What makes up cash to close on a manufactured home
| Cost | Examples | Paid to |
|---|---|---|
| Down payment | The part of the price you pay rather than finance | Escrow, released to the seller |
| Transaction fees | Loan setup fees, escrow or title fees, document fees, recording fees | Lender, escrow company, county |
| State transfer and registration | Title transfer fees and, in California, HCD registration items; in Arizona, ADOT MVD title fees per section | The state agency, through escrow |
| Prepaid items | First year’s insurance premium, interest from the funding date to the first payment, a share of property tax or the HCD annual fee | Insurer, lender, county or HCD |
| Community charges | Resident application fee, deposit, first month’s space rent prorated from the move-in date | The community office |
If the home has to be transported and set on a new site, the move, the setup and any permits form a sixth group. That group belongs to buying a home on owned land, where it is covered with the site itself.
Prepaid items are not fees
Prepaid items are costs you would pay anyway, collected at closing because the lender wants them settled before the loan starts. They surprise buyers because they are not fees for anything, yet they appear on the statement.
- Insurance. Proof of a homeowners policy is a condition of funding, and the first premium is usually paid at or before closing. Rising insurance costs explains why the quote can take longer than you expect in some locations.
- Interest to the first payment. A loan accrues interest from the day it funds. Your first payment is not due the next day, so the interest for the gap is collected at closing.
- Taxes or the annual fee. The seller has paid part of the year’s property tax, or the HCD in-lieu fee on an older California home, and the statement settles the share for the days each of you owns the home.
The community collects its own charges
In a land-lease community you own the home and rent the space it sits on, and the community has its own paperwork and its own money to collect. Its application fee is paid when you apply for residency, before the loan closes. A security deposit and the first month’s prorated space rent may be due at move-in. None of this runs through the lender, so ask the office for its list in writing when you apply.
Community approval is a separate review from the loan, and closing needs both. How resident approval works describes what the office looks at.
Which written statement shows the numbers
Which federal forms you receive depends on how the loan is secured.
- A loan secured by real property, such as a home and land financed together, generally uses the federal Loan Estimate at application and the Closing Disclosure before signing. The Consumer Financial Protection Bureau’s Closing Disclosure guide shows what to compare, line by line, against the earlier estimate.
- A home-only loan on a home held as personal property generally falls outside that rule, and uses federal Truth in Lending disclosures together with the escrow company’s settlement statement.
Ask your specialist at application which set applies to your loan, and ask for the estimate in writing either way. The distinction between personal and real property is explained in why the classification changes the loan.
Check the final statement against the estimate
Whatever the form, read the final statement the same way.
A difference between the estimate and the final statement is not always wrong, but it always deserves an explanation before you sign. The payment calculator can help you see how a fee financed into the loan changes the monthly figure; its results are educational estimates, not a loan offer.
