Can You Get a Mortgage for a Mobile Home?

Whether you are purchasing a mobile or park home in the near future, or are simply considering the options available to you, the wealth of information available can be completely overwhelming. There are lots of fine details and unique rules related to park home properties, which is why it’s important to learn all that you can before making a decision.

At Allens Caravans, we have spent over 50 years specialising in mobile homes, static caravans and park home properties. With five different residential parks dotted across the UK, we are experts in the field of caravan ownership, from purchasing through to pitch fees. Leveraging this knowledge, we have put together a quick guide on one of the most common questions we receive:

Can you get a mortgage for a mobile home?

The Quick Answer

In short, the answer to this question is no, you can’t. However, there are other financing options that you can use to buy your mobile home which operates as a mobile home mortgage.

Why You Can’t Get a Park Home Mortgage

The primary reason why park home mortgages aren’t possible is because of the technicalities behind mortgage loans. Typically, mortgages are tied to the land the property has been built on, meaning that the plot must be registered with the UK Land Registry to be eligible for a traditional mortgage.

Park homes and mobile homes are rarely, if ever, positioned on registered UK Land Registry plots. Instead, the park or site owner already owns this land and those who purchase park homes lease this land from the owner. Ultimately, when you buy a park home you are paying for the property itself but you are not buying the land that it sits on; instead, you will make regular payments to ‘rent’ your position on that land. This process is the same across almost all residential caravan parks.

The cost of leasing the land underneath your park home is known as a ‘pitch fee’ and can vary from park to park, but this system is one of the major reasons why you cannot get a mobile or park home mortgage.

Why This Isn’t a Bad Thing

Whilst you can’t get a traditional mortgage when purchasing a park home, don’t lose hope; there are other financing options available. In fact, the lack of mortgages for park homes can actually be considered a good thing as even if you do get a loan to fund your mobile home purchase, you won’t need to pay for the solicitors or conveyancers that most mortgages demand.

Ultimately, that just means you can spend less money actually obtaining your property, and spend it on the things you love instead.

Alternative Park Home Financing Solutions

If you are hoping to receive a loan to finance your park home or static caravan purchase, there are two main opportunities to choose from.

Park Operator Financing

Park operator financing is when the seller of the mobile home offers financing options directly.

At Allens Caravans, we offer the option of financing a holiday home or static caravan purchase. This is all handled in house and simply requires a minimum deposit to get started. We also offer a variable payment period of up to 10 years to make sure payments work for you. For more information on our financing solutions and the interest rates attached, get in touch with our team or call us on 01564 792323.

Specialist Financing

There are also lenders which specialise in loans for park home financing. This style of lending usually sits in the middle ground between a personal loan and a mortgage, with each specialist lender having slightly different requirements for a successful credit application.

As with all loans, it’s important to do your research on interest rates available, length of payment period and other contractual details to ensure you’re getting the best offer available.

Key Factors in Securing Mobile or Park Home Financing

It’s impossible to guarantee that your credit application will be successful, particularly as every financing company is different, but there are some important points to consider. Most of these are the same for any loan or credit application, so if you’ve done this before then you should recognise the key points:

• Your current financial status – what does your bank account look like? Do you have savings? How much disposable income do you have available? This will be taken into account by your financier
• Your credit history – what loans do you currently have? What loans have you had in the past? Have you ever missed payments or failed to pay off any debt? This is essential for a successful application
• The details of your prospective residential caravan park – if you are using a specialist financing company, they will want to confirm that your loan is actually for a park home. That means investigating the park itself, the property you are looking to buy, its size, value and more. Prepare this information in advance to make for an easy process

There are some other fine details but these are the most important. As always, do your research and find the best deal that works for you, or work with the caravan park operator

You Might Not Even Need Financing

It’s important to note that you may not even need to get a loan for your park home property. By design, many static caravans and mobile properties are significantly more affordable than their brick-and-mortar counterparts. If you are downsizing or moving for retirement, the sale of your current property is likely to fund your new park home easily.

Whatever your concerns or questions, the Allens Caravans team are here to help. If you have more questions about financing your caravan or want to look at some of the available options, check out our range of available properties today or get in touch for bespoke advice tailored to you.