Prefab Housing

Affordable Mobile Homes

Financing your Prefab Home

Prefab Homes
Prefab Home Financing

Many prefab homebuyers have a misconception that prefab homes are a new housing concept. In reality, prefab homes have been around us in some form for more than a few decades. However, it is true that they grew immensely popular over the last ten years or so.

If the immense popularity and convenience offered by prefab homes are urging you to build a new prefab housing structure, then you will initially need to know how to finance your prefab home. Most banks and lending organizations generally issue a loan, which goes through two stages when you are financing prefab homes. This loan is popularly known as construction-to-permanent loans.

The loan offered by the bank will stay as a construction loan until you finish the construction of your prefab home and receive final appraisal when the construction process is completed. You will need to make just “interest only” payments during the first phase, but when the construction of your prefab home is complete, then the loan offered by the bank will become a permanent mortgage. This means that you will have to make a regular payment to the bank against the total amount that you borrowed from the lending institution.

Get a Prequalification Estimate

The first and most important thing to do before financing your prefab home is to find an estimated figure on how much you will be able to spend on your new prefab home. So, give all your financial details and credit history to your bank because they will give you an estimate on how much they are willing to lend to you for your new home.

Compare Rates

If you are ready to do a little bit of research on the rates offered by different banks or lending institutions, then the chances of acquiring a better financing deal are a lot higher. So, make sure to compare the rates offered by the lending institutions and carefully evaluate them, as it will help you save thousands of dollars.


Let us assume that you have already picked out a bank to help you finance for your prefab home, then the next thing to do is to apply for a loan. Below are a few things that you will need for applying for a loan.

  • Proof of employment
  • Work History for the last 5 years
  • A thorough account of your debts and assets
  • IRS Form 4506-T