Budgeting Your Manufactured Home Construction Project
Planning and accurately estimating costs is key to your project success.
Once your pre-planning is finalized we begin pulling all the numbers together to get a reliable cost estimate including home cost and upgrades with delivery, third party site planning and engineering, permitting and dirt work cost.
Costs for utility moves and hookup must be determined. Foundation construction for a home on land in California requires a licensed engineer's plan and certification. Other construction costs such as decks, steps, garages, carports and sheds need to calculated with a high level of confidence. We build in contingency factory into every budget, but we do our best to nail down costs and eliminate uncertainties.
Once the home and land acquisition costs are known factors, Soft and Hard Costs will need to calculated.
- Structural Engineer's Certification of Plans
- Site Permits and Building Permits
- Termite Treatment
- Initial Inspections (FHA and County)
- Septic Permit
- Water well approval
- Construction Surveys
- Impact Tap / Fees
- Site Grading and Clearing - Fire Service Clearance Required in California
- Septic System or Utility hookup
- Water Tap and Connection to Install
- Electric Service to Site
- Electrical hookup to home and out buildings
- Setup Trim
- Perimeter enclosure (if not part of foundation design)
- Air Conditioning
- Sidewalks and concrete patios
- Decks, Porches, Steps
- Back fill and Final Grading
If you are using the One Time Close Loan, your total acquisition cost is the basis for your loan. Your appraisal may be higher, but the loan to value ratio is calculated on the total cost of the project plus construction loan cost and interest. Once the full package is developed and permanent financing approved, your construction package is submitted to our construction lender. They will provide a quote for the construction loan component that may be added to the price of the home and included in the total acquisition cost calculation.
The buyer is not permitted to complete any of the work; however, we want your involvement and help getting your project ready to build. Site planners will help with your permitting process but the customers involvement is imperative to the success of the project.
Depending on underwriting review, some permit costs may require pre-payment or may be required to be approved pending payment.
Undeveloped land must have had an acceptable percolation test or utility access completed prior to planning.
There are a lot of ways to purchase a new manufactured home on land in California. Every situation is unique. The management team at MH Factory Homes is made up of licensed California loan originators that specialize in new manufactured home purchases in parks and on land. We maintain a lender's attention to detail. Every purchase situation is unique. Our background and market knowledge make a difference maker. Here are a few questions about closing we hear and a few options we offer.
Is Escrow Required?
Use of a licensed escrow company is required on all transactions. Working with the escrow company, we will work with you to develop a comprehensive set of escrow instructions for your purchase. Instructions will be written for your purchase detailing timing of payments and construction mile stones.
How Does the One Time Close Program Work?
The One Time Construction Loan allows new manufactured home buyers to include the purchase of their new home and all construction costs into an single closing that converts to a permanent FHA loan. Title to the land is secured at closing and construction is paid in stages. Construction loan costs and interim interest are added to the sales price of the home and are not considered seller contributions for the loan. Once construction is complete, the construction loan is converted to the permanent loan. No Second Closing is Required!
Can I use my land as a Down Payment?
Yes, the value of your land can be your down payment. Whether you own the land free and clear, have a land only loan, or even a loan on existing structure, the equity in your property can be considered down payment for the purposes of the One Time Close loan.
How do Construction Loan Draws Work?
Typically the construction loan component is calculated after all construction costs including delivery and setup of the new home home. Funds are disbursed in 3 draws.
- Land Paid At Closing - The first draw pays off any existing liens and titles the land in the new owners name.
- Payment is made to the factory at the the time of shipment. This draw can also be used to satisfy contractor payment for construction work completed.
- Final draw takes care of any remaining construction like carports, garages or landscaping.
How do you work with cash buyers?
We think like lenders, but realize nearly half of all manufactured home buyers in California pay cash for their new manufactured home. We apply the same attention to cost detail and construction plans. Escrow instructions will require the full purchase price including setup and delivery to be deposited into escrow prior to the home being placed into construction.
Can you help me buy my land?
Land only transactions can be handled by our real estate company, MH Realty Associates. We can help you structure a purchase plan that will dovetail with the construction of your new home.