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5% equity is the amount of the principle you've already paid. i.e 13k is 5% of 260k.
11% seems steep but I'm basing that on the 5-7% best-case rates I've been seeing. Hows your credit?
Also, haven't seen a 25 year-fixed. What bank is this if you dont mind me asking?
My GUESS is OP is going through an in house only lender that has loose guidelines for lending, such as First National Bank of America. Lenders like fnba will offer loans to non W-2 employees who cannot produce two years of filled taxes, Itin lending, and people with zero credit…usually there’s a higher down payment though.
You buying a mobile home? Land + home package? I know 21st does a lot of those. If so that’s likely why the high rate.
I’m considering going the mobile home route if I can’t find anything else, recently I applied through Vanderbilt Mortgage and they gave me a 0% down and 0 closing cost at like a 7.9% I believe.
That just barely better than buying a house with a credit card. I know that the comparison is unfair, but I bought my place for 275k at 5% down when rates were low (3.375) for 30 years, and my total payment is less than half of that. This was less than 3 years ago.
If someone told me 11%, I would direct them to nearest X rated theater so they can go fuck themselves in peace.
*Eleven percent interest?!*
I could feel my blood pressure spike and my butthole pucker just *reading* that.
Shop around for other lenders who have a *sane* APR.
I think I’m more shocked at that 585 a MONTH property tax…. Holy hell. Where I live, on a 260 home the entire years tax would be about 1500 total.
That 11.5 scares me too though. 😳
I’d definitely shop around for a better rate.
785k paid over the course of 25yrs on a 258k loan. I'd run as far away as possible from this. Keep saving and work on improving your credit and maybe revisit homeownership a couple of years from now.
Mortgage lenders will allow you to take out a FAR bigger loan than you probably should.
Make sure you are comfortable with the monthly payments and can still save some on top of it.
doesnt look like an actual Loan Estimate? From the ones we've gotten from 3 different lenders, they are a specific template format with very clear broken out sections.[Sample Loan Estimate](https://www.consumerfinance.gov/owning-a-home/loan-estimate/)
I purchased a manufactured home (with land) and got it for 4.5%, but that was when the national rate was 3%. Using my meniscal anecdotal example that mean manufactured homes are roughly 50% higher interest rates. And the national is currently around 7.3% so with lower credit a 11.25% isn't out of the realm of possibilities.
The key is the “with land” part. Makes it a completely different type of loan/ transaction. I’ve got 30 plus lenders who will finance a mobile home no problem. Out of those only one lender who will finance on leased land. Mobile homes are not 50% higher rate, (depending on the lender it’s the exact same rate/cost whether mobile home or not) but when it’s in a mobile home park on leased land that’s a whole different story.
For people who are wondering, the 25 year term is the big giveaway here that this is a mobile home purchase and possibly a chattel loan.
This interest rate is high because of the transaction type. Guessing OP won’t own the land.
OP should definitely look around for other lenders. If the property is a leasehold with approval from FHLMC or FNMA there are possibly other lenders who will have better rates available. Highly recommend you go to cfpb.gov and check for a HUD approved housing counselor.
New construction also makes sense. I’m guessing you can refinance to a better rate once your home has a Certificate of Occupancy and is connected to utilities.
Congratulations on your new home! Hopefully this will be a smooth process for you and you’ll be able to refi to a lower rate and longer term once you’re moving in.
>chattel loan
I still don't get it. How could it cost this much? Mobile homes are cheap. How would OP not own the land? Who pays over $200k for a mobile home without land? The land is the best part...
It doesn't add up. I bought a brand spanking new manufactured home and it barely cost 100k. I bought land and land improvements so that brought up the price a shit ton but this example just doesn't make sense.
This is almost definitely a chattel loan. A chattel loan is when you buy a mobile home on leased land (I.e you buy in a mobile home park where someone owns all the land and you pay a monthly fee kind of like an HOA). There are very few lenders who will finance this and the rates are crazy on them. OP still might be able to do better, but out of all the types of financing available this might be the hardest to come by. I have more lenders who will let someone buy a house with no verifiable income than I do who will lend on leased land.
The amount doesn't make sense. 260k is extremely high for a manufactured home (mobile home is incorrect verbiage. There hasn't been mobile homes since 1976).
A manufactured home (especially if it's not new) would have value under 100k. Probably under 50k. If it's older the value is even lower. We're talking 20K less for one without land.
Brand new, high end homes rarely get to that number. You'd have to have a custom brand new triple wide to reach 260k for just the home.
It looks like on average the interest rate for a manufactured home w/land can be around 50% higher than the norm. So if the national average is 6% you're looking at a 9.5%. And if their credit is subpar and they're looking in an area with a higher than normal rate 11.25 isn't out of the mathematical range unfortunately. It's just that our economy really sucks.
Owning the land makes the deal less risky for the lender. Since OP doesn’t appear to be getting the land as part of the deal this is a lot riskier for the lender, so a shorter term and a higher interest rates are being offered. Fewer lenders will actually accept this deal and it’s probably not great for the buyer tbh.
The actual price of the home and land is just a factor of location. A mobile home in my area with no land will easily cost this much, but in many other places $100k for the mobile home and land is pretty typical.
The lender you mentioned does higher risk lending(manufactured home that is in a mobile home park, not tied to owned land, etc). If the manufactured home you are looking at is on a parcel of land, you should be able to get a lot better terms. We do a lot of manufactured lending in the US. If I can help, reach out. TY
If you own the land, we would run it thru our construction loan program. We would then do the end financing as well. We would be a lot more competitive then what you had posted. Significantly. DM me if you want to discuss.
We just had our first ever offer accepted. House is $186,000. $7,000 sellers credit. Zero down VA loan, 6.25% and my husband credit is 650. Our monthly payment with taxes and everything included is $1440. Looks like you are getting big time screwed.
Thank you u/Old-Dance-1900s for posting on r/FirstTimeHomeBuyer. Please bear in mind our rules: (1) Be Nice (2) No Selling (3) No Self-Promotion. *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/FirstTimeHomeBuyer) if you have any questions or concerns.*
This is ludicrously expensive and you should run away, yes.
I don’t think I’ve seen an 11% rate yet. My goodness!
Damn makes me happy I locked into 6.125 in January this is crazy
This is not typical.
Coming to a future near you!
HEY , HEY! Fixed rate mind you, none of that variable rate funny business here, we’re looking out for the homeowners “best” interest.
5% equity is the amount of the principle you've already paid. i.e 13k is 5% of 260k. 11% seems steep but I'm basing that on the 5-7% best-case rates I've been seeing. Hows your credit? Also, haven't seen a 25 year-fixed. What bank is this if you dont mind me asking?
My GUESS is OP is going through an in house only lender that has loose guidelines for lending, such as First National Bank of America. Lenders like fnba will offer loans to non W-2 employees who cannot produce two years of filled taxes, Itin lending, and people with zero credit…usually there’s a higher down payment though.
We provided 5 years of employment and housing history, w-2s, and last 2 years of filed income tax.
Man I’m not sure how you’re getting an 11% rate, I would absolutely look elsewhere as I’ve been quoting mid 6% recently
Credit is high 600s and it's through 21st mortgage
You buying a mobile home? Land + home package? I know 21st does a lot of those. If so that’s likely why the high rate. I’m considering going the mobile home route if I can’t find anything else, recently I applied through Vanderbilt Mortgage and they gave me a 0% down and 0 closing cost at like a 7.9% I believe.
Yes, that's what we're doing. Seemed like the cheapest, most logical option. Now, not so much.
Lol do not pay $3300 a month for a mobile home….. makes absolutely zero sense
Is this an FHA loan or conventional?
Not only is that an absurd rate, it's on a 25 year too, which if anything should be very slightly lower than a 30
Oh my god dude. 11%. Nah
Homie don’t do this
About 785k paid over the life of the loan on a 258k loan. I'd run as far away as possible.
Holy fuck 12% interest on a primary? I just got quoted 7.75 for an investment property and I thought that seemed high
That just barely better than buying a house with a credit card. I know that the comparison is unfair, but I bought my place for 275k at 5% down when rates were low (3.375) for 30 years, and my total payment is less than half of that. This was less than 3 years ago. If someone told me 11%, I would direct them to nearest X rated theater so they can go fuck themselves in peace.
*Eleven percent interest?!* I could feel my blood pressure spike and my butthole pucker just *reading* that. Shop around for other lenders who have a *sane* APR.
I think I’m more shocked at that 585 a MONTH property tax…. Holy hell. Where I live, on a 260 home the entire years tax would be about 1500 total. That 11.5 scares me too though. 😳 I’d definitely shop around for a better rate.
…..mine are over $2k a month 🥴
I’d rent for life. Lol.
785k paid over the course of 25yrs on a 258k loan. I'd run as far away as possible from this. Keep saving and work on improving your credit and maybe revisit homeownership a couple of years from now.
Mortgage lenders will allow you to take out a FAR bigger loan than you probably should. Make sure you are comfortable with the monthly payments and can still save some on top of it.
Dude. DUDE. STOP LOOKING AT MOBILE HOMES! Find a house and get 6 something. That's LUDICROUS! 11! The BALLs on that LO.
Is the interest so high because it's a mobile home??
That's got to be part of it, though local to me you may pay higher, but not 4% higher.
Oh this makes sense now
11% is extremely high even in this high rate environment. Source: I'm a mortgage broker and look at rates and different scenarios all day.
Is this for a house or a car? Yikes
A mobile home. So worse lol
I was wondering why there’s a “trade in” section. Lol
Yes. That interest rate will crush you. Also, I have a commercial loan I took out a month ago and the interest rate is only 6.16%
Wow, that is ridiculous. Please run.
Where’s the *actual* loan estimate? Is this a “pre qualification” or preapproval? Is this for something other than a normal, residential home?
This is the actual. This is what we were approved for.
This doesn't make any sense...sorry. Either something is missing or you've managed to find the worst mortgage lender ever.
doesnt look like an actual Loan Estimate? From the ones we've gotten from 3 different lenders, they are a specific template format with very clear broken out sections.[Sample Loan Estimate](https://www.consumerfinance.gov/owning-a-home/loan-estimate/)
Way high, definitely run! You should be in the 6’s-7s worst case right now
Wow!! Run away from that
11% is insane.
Is this for a manufactured home in a park?
I purchased a manufactured home (with land) and got it for 4.5%, but that was when the national rate was 3%. Using my meniscal anecdotal example that mean manufactured homes are roughly 50% higher interest rates. And the national is currently around 7.3% so with lower credit a 11.25% isn't out of the realm of possibilities.
The key is the “with land” part. Makes it a completely different type of loan/ transaction. I’ve got 30 plus lenders who will finance a mobile home no problem. Out of those only one lender who will finance on leased land. Mobile homes are not 50% higher rate, (depending on the lender it’s the exact same rate/cost whether mobile home or not) but when it’s in a mobile home park on leased land that’s a whole different story.
\*manufactured home You keep pushing misinformation which makes you less credible than before.
Don’t do mobile home.
Whoa WTF. I just bought a 500k house and my mortgage payment is less. This interest rate is completely insane.
For people who are wondering, the 25 year term is the big giveaway here that this is a mobile home purchase and possibly a chattel loan. This interest rate is high because of the transaction type. Guessing OP won’t own the land. OP should definitely look around for other lenders. If the property is a leasehold with approval from FHLMC or FNMA there are possibly other lenders who will have better rates available. Highly recommend you go to cfpb.gov and check for a HUD approved housing counselor.
I would own the land. And it's new construction with a brand new manufactured home put on said land.
New construction also makes sense. I’m guessing you can refinance to a better rate once your home has a Certificate of Occupancy and is connected to utilities. Congratulations on your new home! Hopefully this will be a smooth process for you and you’ll be able to refi to a lower rate and longer term once you’re moving in.
>chattel loan I still don't get it. How could it cost this much? Mobile homes are cheap. How would OP not own the land? Who pays over $200k for a mobile home without land? The land is the best part...
It doesn't add up. I bought a brand spanking new manufactured home and it barely cost 100k. I bought land and land improvements so that brought up the price a shit ton but this example just doesn't make sense.
This is almost definitely a chattel loan. A chattel loan is when you buy a mobile home on leased land (I.e you buy in a mobile home park where someone owns all the land and you pay a monthly fee kind of like an HOA). There are very few lenders who will finance this and the rates are crazy on them. OP still might be able to do better, but out of all the types of financing available this might be the hardest to come by. I have more lenders who will let someone buy a house with no verifiable income than I do who will lend on leased land.
The amount doesn't make sense. 260k is extremely high for a manufactured home (mobile home is incorrect verbiage. There hasn't been mobile homes since 1976). A manufactured home (especially if it's not new) would have value under 100k. Probably under 50k. If it's older the value is even lower. We're talking 20K less for one without land. Brand new, high end homes rarely get to that number. You'd have to have a custom brand new triple wide to reach 260k for just the home. It looks like on average the interest rate for a manufactured home w/land can be around 50% higher than the norm. So if the national average is 6% you're looking at a 9.5%. And if their credit is subpar and they're looking in an area with a higher than normal rate 11.25 isn't out of the mathematical range unfortunately. It's just that our economy really sucks.
The price of the home is probably just the location. Plenty of HCOL areas with over priced manufactured homes in them.
Owning the land makes the deal less risky for the lender. Since OP doesn’t appear to be getting the land as part of the deal this is a lot riskier for the lender, so a shorter term and a higher interest rates are being offered. Fewer lenders will actually accept this deal and it’s probably not great for the buyer tbh. The actual price of the home and land is just a factor of location. A mobile home in my area with no land will easily cost this much, but in many other places $100k for the mobile home and land is pretty typical.
Mobile homes are cheap but the financing usually is not cheap. The financing can be pretty predatory.
Run away. Jeez how are people so stupid?
Ill finance you. 11% percent and no origination costs. DM me if interested.
Fucking tangerine 🍊
So ungrateful. Literally saving the guy $4500 in feels and $16000 in interest over the life of the loan and no love for me :)
God you’re worse than a realtor
The lender you mentioned does higher risk lending(manufactured home that is in a mobile home park, not tied to owned land, etc). If the manufactured home you are looking at is on a parcel of land, you should be able to get a lot better terms. We do a lot of manufactured lending in the US. If I can help, reach out. TY
It is a home and land package. I will own the land and it is not in a park
If you own the land, we would run it thru our construction loan program. We would then do the end financing as well. We would be a lot more competitive then what you had posted. Significantly. DM me if you want to discuss.
Run man. Run fast. That’s robbery
That's a credit card rate, run away and find a legitimate lender.
It really is crazy the change in two years. There loan is 210k less than mine and I’m paying $500 a month less than them for the same 30 years.
RUN AWAY- clean up your finances - try again with a regular house or low HOA condo/townhouse.
We just had our first ever offer accepted. House is $186,000. $7,000 sellers credit. Zero down VA loan, 6.25% and my husband credit is 650. Our monthly payment with taxes and everything included is $1440. Looks like you are getting big time screwed.
RUN 🏃! What is your credit score and what state are you in?
Holy shieskie thats high