Why Mobile Homes?

There are mobile homes for sale, for much less than stick-built houses, in most areas of the country. Despite persistent predjudice against them, and sometimes the people living in them, mobile homes are the cheap housing choice of millions. The advantages are not always obvious, but they are real.

First of all, let's acknowledge the big "truth" about mobile homes and appreciation or depreciation. It's true in most areas that mobile homes in parks go down in value over time. That's why I don't recommend buying in a park, unless you absolutely can't buy real estate, and you have done the math to see if you are better off than renting a nice apartment.

To "do the math" consider lot rent, payment, and the remaining value of the mobile when you put it up for sale, minus what you will still owe, when you are likely to move. These are guesses, but still better than nothing if you are as objective as you can be.

Mobile Homes For Sale With Real Estate

When looking at mobile homes for sale on land, however, you are looking at an entirely different investment. My mobile home in Michigan doubled in value in the twelve years I lived in it. That's because even as the home deteriorated a little over time (don't all houses?), the value of the land continued to rise. You also can do what you like with the home when you own the land. For example, I took in more money from my home than it originally cost, by renting out a room or two over the years.

As mentioned, mobile homes usually sell for less than other houses, and this means lower payments. Also, because of the shortened amortization and lower loan amount, you will often build equity faster in a mobile home than in a more expensive house. A quick example follows, for the skeptical among you.

Equity Building With Mobile Homes

If you buy a house with a $100,000 mortgage loan amortised over 30 years at 6% interest, you'll have a payment of $599.60. Of the first payment, $500 will go towards interest, $99.60 towards principal. In other words, you only built equity of $99.60 (I'm ignoring appreciation, but only for the moment).

Second scenario: Find a nice mobile home for sale, and borrow only $30,000, at 8% interest, amortised over 10 years. Note that higher interest is always the case with "factory built home mortgages." The shorter term is normal too, but least you'll own your home free-and-clear in 10 years instead of 30. Despite higher interest and a shorter term, the payment will be only $363.99, and the first month only $200 will go towards interest. That means the other $163.99 goes towards principal. You bought more house (built more equity) in this scenario.

It's true that a mobile home on land might appreciate more slowly than a "regular" house, but the faster loan pay-down probably more than covers this factor. If you also chose to bank the difference in payments ($235.61 per month), you'd definitely be better off financially with the mobile home versus the more expensive home.

Pay less per month and build more equity! Don't expect your real estate agent to tell you this. Don't expect him to even agree with me after you explain it. I sold real estate years ago, and math skills were not a big part of the licensing requirements.

Mobile Homes For Sale; Other Advantages

Mobile homes are cheaper to maintain. Years ago I had a mobile home as a rental, and the furnace in it died. This is the most expensive repair you'll have in a mobile. I had to replace it for $1,200, but that was still less than a furnace for a larger home. Consider that for $200 you can tar the roof of your home, or $30 if you do it yourself, instead of $5,000 to re-shingle a traditional roof. The windows, plumbing, doors - all cheaper.

Property taxes will cost less, because they're based on the value of the property, and mobile homes for sale on land have lower value than stick-built houses. Insurance may cost less too, again because you are insuring less value. The only precaution to remember here is to be sure you can get insurance. Very old mobiles may be uninsurable in some areas.

Should You Buy A Mobile Home?

Don't buy a mobile home if prices for houses in the area are just as low. Believe it or not, this is the case in some areas. We bought a house near Butte, Montana for $17,500 - less than mobile homes for sale there (See a photo on our site www.HousesUnderFiftyThousand.com).

Houses do generally hold up better. Then there are the issues of whether your own needs and predjudices will let you be comfortable in a mobile home. They are sometimes for sale in areas you don't want to live in (Certainly true of houses as well). These are personal things you have to consider.

The advantages are clear for many young people starting out. It may be their only option, but it may be your better option. Besides a lower initial price, you get simpler, cheaper maintainance, lower monthly payments, less property tax, less for insurance, and faster equity build-up. So don't automatically pass on those mobile homes for sale when you're out home-hunting.

Steve Gillman and his wife Ana have converted their mobile home in Michigan to a rental and moved to Tucson, Arizona. He and his wife also lived for a while in Montana, where they bought a beautiful house (not a mobile) for $17,500. That experience lead to the creation of their website, http://www.HousesUnderFiftyThousand.com

More than 40 states signed onto a proposed $25-billion deal with major mortgage servicers over faulty foreclosure practices. New York, Nevada and Delaware joined California in holding out for better terms.

More than 40 states signed onto a proposed $25-billion settlement with major mortgage servicers over faulty foreclosure procedures, but California, New York and other key states were still not among them.

California has until Monday to share in a multi-state deal with banks to obtain mortgage relief and reforms. Atty. Gen. Kamala Harris, who walked away from talks last year, says the door remains open.

With a Monday deadline at hand, California officials have resumed direct talks with the Obama administration about joining a multibillion-dollar, multi-state mortgage settlement with the nation's largest banks, a source said Sunday.

The talk show host pays $12 million for the 4,088-square-foot house with four bedrooms and four bathrooms. The ocean-view home sits on 1.26 bluff-top acres with beach access.

In one of the more talked-about transactions in town, actors Brad Pitt and Angelina Jolie have sold their Malibu beach house to daytime host and comedian Ellen De Generes for $12 million.

The four-bedroom, five-bathroom house built in 1920 for industrialist James Wigmore lists for $2,875,000.

A decorative cast stone entrance opens to this restored Spanish Colonial Revival-style house in Pasadena's South Orange Grove area. Built in 1920 for industrialist James Wigmore, the house retains such original details as coffered wood ceilings and arched doorways.

They don't believe they can sell their property for what it's worth, so they're spending money on making their homes more comfortable.

Do you fit any of these descriptions?

A biennial research report by the National Assn. of Realtors indicates that a handful of real estate agents and brokers and their clients either don't know the law or don't care to follow it.

When it comes to lawsuits, real estate agents and brokers tangle mostly among themselves.

The president aims to help about 3.5 million people with good credit who are unable to refinance at historically low rates because their homes are worth less than their mortgages.

 

The White House hopes to help millions of homeowners lower their monthly mortgage bill with a $5 billion to $10 billion plan to set up a streamlined refinancing program for people who are current on their payments.

The Standard & Poor's/Case-Shiller index of 20 large U.S. cities fell 1.3% in November from October as foreclosures continue to drag down the housing market.

Three straight months of home-price declines in the biggest U.S. cities showed that foreclosures remain a significant drag on a housing market that is entering its fifth year of deterioration.

L.A. Clipper Chris Paul may be quick down the court, but he moves pretty fast when it comes to buying multimillion-dollar real estate too.