Mobile, manufactured, modular. These types of homes sound similar, and they’re all prefabricated, but they differ in cost, customization, ease of financing, and in other ways, too.
When it comes to old-style mobile homes and modular vs. manufactured homes, here’s what to know if you’re considering a purchase.
Key Points
• Mobile homes are structures built before 1976. They differ from manufactured and modular homes in construction and regulatory standards.
• Manufactured homes are built on steel chassis, frequently placed on rented land, and comply with HUD Code.
• Modular homes are factory-built in sections, assembled on-site with permanent foundations, and must adhere to local building codes.
• Modular homes offer more customization and design flexibility.
• Modular homes typically cost more than manufactured homes due to foundation and land requirements.
What Is a Mobile Home?
Unlike a stick-built, or traditional, home built from the ground up, a mobile home was built in a factory before mid-1976. Original mobile homes looked like trailers, or campers. They have wheels and an exposed coupler for a trailer, making them easy to hook to a vehicle and move. But the name is a bit of a misnomer: Most are never moved.
Original mobile homes aren’t built anymore. They don’t meet the current safety standards, even if interior renovations can make them look appealing.
First-time homebuyers can
prequalify for a SoFi mortgage loan,
with as little as 3% down.
Questions? Call (888)-541-0398.
What Is a Manufactured Home?
A manufactured home is built in a factory, then transported to its destination in one or more sections. Sound familiar? That’s because manufactured homes are the 2.0 version of mobile homes.
In 1976, the U.S. Department of Housing and Urban Development (HUD) changed the “mobile home” classification to “manufactured” legally and began to regulate the construction and durability of the homes.
More change and innovation have come with time. That is covered below.
What Is a Modular Home?
Modular homes start their lives in a factory, where modules of the homes are built. The pieces, usually with wiring, plumbing, insulation, flooring, windows, and doors in place, are transported to their destination and assembled like a puzzle.
Modular homes are comparable to stick-built homes in most ways other than birthplace.
Recommended: Choose a Favorite From the Different Types of Homes
How Mobile, Manufactured, and Modular Homes Differ
These homes may all share a starting point, but there are key differences to know, whether you’re a first-time homebuyer or not. For the sake of simplicity, let’s compare manufactured homes and modular homes.
Construction
Manufactured homes are built from beginning to end in a factory on a steel chassis with its own wheels. Once a manufactured home is complete, it’s driven to its destination, where the wheels and axles are usually removed and skirting added to make it look like a site-built home, or it may be attached to a permanent foundation.
Construction and installation must comply with the HUD Code (formally the Manufactured Home Construction and Safety Standards) and local building codes.
Modular homes are built in pieces in a factory, then transported to the property. From there, a team assembles the home on a permanent foundation.
While a modular home may be built states away from its final home, it needs to comply with the state and local building codes where it ultimately resides.
| Manufactured Homes | Modular Homes | |
|---|---|---|
| Fully factory-built? | Yes | No (but mostly) |
| Permanent foundation? | Not commonly | Yes |
| Construction regulated by | HUD Code | State and local codes |
Design
There’s a fair share of design differences when it comes to modular vs. manufactured homes.
Manufactured homes come in three standard sizes:
• Single-wide: roughly 500 to 1,100 square feet
• Double-wide: about 1,200 to 2,000 square feet
• Triple-wide: 2,000+ square feet
The most significant limiting design factor of manufactured homes is the layout. As they must be delivered fully assembled on a trailer, they only come in a rectangular shape. In the case of single- or double-wides, there’s not much space to separate rooms or interior hallways to connect them.
In terms of design, there’s much more freedom in modular homes. They can be just about any style, from log cabin to modern, and can have more than one floor.
The design options of a modular home are similar to a stick-built home. Floor plan and style are only limited by a buyer’s budget and space. A modular home may look just like a site-built home upon completion.
| Manufactured Homes | Modular Homes | |
|---|---|---|
| Size limitations | Yes, single-, double-, or triple-wide | No |
| Shape limitations | Yes, rectangular only | No |
Customization Options
Most makers of manufactured homes allow some customization, including:
• Custom kitchen layout and cabinetry
• Porches
• Custom layouts (within the confines of prefab shapes)
• Siding
• Built-in lighting
• Ceiling finish
• Fireplace
• Tiling
Similar to stick-built homes, modular homes have nearly endless customization options. From the style of the home to its size and layout, modular homes offer more flexibility for buyers.
Expense
The expense of a modular home vs. manufactured home can vary dramatically.
A modular home — also sometimes called a kit home — may cost less than a stick-built home, but it usually costs a lot more than a manufactured home.
Both modular and manufactured homes have a separate expense: land. In the case of manufactured homes, it may be possible to rent the land the home is delivered to, but owners of modular homes will need to buy the land they want to build on.
Another cost associated with modular homes is the foundation, which needs to be in place when the modules arrive. Manufactured homes affixed to a permanent foundation on land owned by the homeowner are considered real property, not personal property.
Here are some typical expenses associated with each home:
| Manufactured Home | Modular Home | |
|---|---|---|
| Average cost | $85 per square foot | $100,000-$200,000 per square foot (including installation but not land) |
| Foundation (slab) | $12,000 to $28,000 | $6,000 to $20,000 |
| Land | Is often rented; varies by location | $10,000-$100,000; varies by location |
Another expense to keep in mind is financing. An existing modular home will qualify for a conventional mortgage or government-backed loan if the borrower meets minimum credit score, income, and down payment requirements.
Homebuyers building a new modular home often will need to obtain a construction loan.
Manufactured and mobile home financing is trickier. The key is whether the home is classified as real or personal property.
Manufactured homes classified as real property, including those used as accessory dwelling units that are at least 400 square feet, might qualify for a conventional or government-backed loan.
Financing options for mobile and manufactured homes classified as personal property include a chattel mortgage and an FHA Title I loan.
A personal loan is another option.
Recommended: Explore the Mortgage Help Center
The Takeaway
Mobile, manufactured, and modular homes have key differences. A manufactured home on leased land is not considered real property, while a modular home, always on its own foundation and land, is, and compares in most ways to a traditional stick-built home.
SoFi will finance a manufactured home if you qualify, refinance a construction-only loan to a traditional home mortgage loan or provide a mortgage for an existing modular home.
Looking for an affordable option for a home mortgage loan? SoFi can help: We offer low down payments (as little as 3% - 5%*) with our competitive and flexible home mortgage loans. Plus, applying is extra convenient: It's online, with access to one-on-one help.
FAQ
Is a modular home better than a manufactured home?
In terms of appreciation and resale value, a modular home has the edge over most manufactured homes. And if a manufactured home is on leased land, the owner may face lot fees that keep rising.
What’s the price difference between mobile, manufactured, and modular homes?
Generally, mobile and manufactured homes are much less expensive than modular homes. A mobile home, by its very definition, was built before mid-1976. The size of the price gaps depend on how customized the home is, where it is, and how large it is.
Between manufactured and modular homes, which is fastest to build?
Unless there are factory or supply chain delays, manufactured homes are typically faster to build than modular homes. (Of note: A modular home can often be built much faster than a stick-built home.)
Photo credit: iStock/Marje
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