Title is vested in Life Estate. This is also a Mobile Home that has been converted to Real Property. What is needed to make sure this goes through Underwriting correctly and smoothly?
The life estate agreement and all remaindermen counselled along with the borrower is required. As well as the following: FHA permits mortgages to be insured if the borrower’s interest in the property is a Life Estate. However, to encumber fee simple interest in the property, the borrower and all holders of any future interest in the property must execute the Deeds and Right to Cancel at Closing. Holders of future interest do not execute the Note or other loan documents.
The Manufactured Home must meet FHA’s requirements to be eligible for FHA financing.
- Eligibility Guidelines:
- Completed on Appraisal Form 1004C for Manufactured Housing.
- Floor area of at least 400 square feet.
- Constructed after July 15, 1976.
- Built and remains on permanent chassis.
- Axles and tongue must be removed.
- Permanent utilities installed.
- Permanent skirting around the perimeter.
- Meet county and HUD requirements for any additions.
- Designed as a dwelling with a permanent foundation built to FHA criteria.
- Be on the original site. The home may not have been installed or previously occupied at any other location.
- Have all HUD tags on the outside of the house. Multi-wide units display a label on the outside of each unit.
- Manufactures Homes ineligible for HECM:
- Singlewide Units
- Condominium (Manufactured homes in a condo association)
- Homes built prior to June 15, 1976
- New Construction Manufactured Homes (less than 1 year ago)
- Homes moved from original site
- Homes previously installed or occupied at another site
- Homes installed in a flood zones or partial flood zone
The unit must be permanently affixed to a foundation and taxed as Real Property. An Engineer’s Report for the Foundation would be required to establish the foundation complies with FHA’s requirements for FHA financing.