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For many mobile and manufactured homeowners, building equity has not always meant having easy access to that equity. Homeowners in mobile home parks and manufactured home communities often face a financing gap when their home is located on leased land or rented space rather than owned real estate.
Sonoma Federal Credit Union is helping close that gap with a pilot Mobile Home Equity Line of Credit, for eligible mobile and manufactured homes in California parks and communities where residents don’t own the land their home sits on. This service is designed to help qualified homeowners access the value they have built in their homes without selling; which is historically the only option for accessing that built up home equity.
A HELOC Designed for Homes in Parks
Traditional home equity lines of credit are usually associated with site-built homes on owned land. But many mobile and manufactured homeowners own their homes while renting the space beneath them. These homes are often considered “chattel” or personal property, which can make equity lending nearly impossible to find.
Sonoma Federal Credit Union’s program is designed for this need: a home equity line of credit for eligible mobile and manufactured homes in California parks on leased land. Qualified borrowers receive a revolving line of credit secured by their home, allowing them to draw funds as needed, have the cost of interest only on the amount used, and reuse available credit as the balance is repaid; just like every other homeowner in the country.
Why This Matters for Park Residents
For many park residents, their home is one of their most valuable assets, yet access to equity programs has historically been non-existent.
“Homeowners in parks should have the same access to home equity programs as those who own traditional homes; and with this program, we make that happen.” said David Powell, Interim CEO of Sonoma Federal Credit Union. Mr. Powell went on to explain how a mobile home HELOC can be used for repairs, upgrades, renovations, emergency expenses, debt consolidation, major purchases, college expenses, or “just about anything someone might need”.
The program may also be well suited for buyers purchasing a mobile or manufactured home without financing. In many cases, the equity line can be added as part of the home purchase transaction with almost no additional cost, creating a large available credit line that is available if it is ever needed.
Available as a California Pilot Program
For now, this mobile and manufactured home equity line of credit is being piloted only in California. It is intended for qualified homeowners in eligible mobile home parks and manufactured home communities where the homeowner pays monthly space rent.
Eligibility depends on the home, the park or community, the lease or rental agreement, credit profile, income, debts, monthly space rent, insurance, and valuation of the home. While not every park, community, or home will qualify, Sonoma Federal Credit Union reviews each application individually.
Homeowners in parks can learn more directly from Sonoma Federal Credit Union’s page: https://www.sonomafed.com/hl-heloc-mobile-manufactured-homes.html
Decades of Manufactured Home Lending Experience
Sonoma Federal Credit Union has offered home purchase loans throughout California for older mobile homes and manufactured homes for more than three decades, including homes located both in parks and on owned land.
The credit union is an Equal Housing Lender and also helps with home purchase loans for newer manufactured homes in parks anywhere in the United States. However, this unique equity line program, as well as lending on older units, is currently available only in California.
