Late in 2015, FHA changed their flood zone requirements for manufactured homes in a flood zone. Because I get lots of questions on the subject, here is a quick summary of the new requirements for FHA, and the requirements for VA and Conventional loans:
FHA will not do a loan on a manufactured home in a flood zone unless a flood elevation survey is done to show that the land under the home and its mechanicals are above the flood elevation. This means, of course, that only part of the home’s lot is in a flood zone….and the part with the home on it is not. The old rule was that the living area of the home had to be above the flood elevation….not the land under it. So now these homes that qualified under the old rule but not the new one, are now ineligible for FHA financing.
VA- Follows FHA’s guidelines.
Conventional loans (Fannie Mae and Freddie Mac) “Flood insurance coverage is required for all residential buildings on the mortgaged premises if any part of the structure is located within an SFHA (Special Flood Hazard Area).” Insurance must be for 100% replacement cost of the improvements or for a minimum of the loan amount.
So, if the home is in a flood zone, conventional is the way to go!
Call if you have any questions:
Eric North
Arizona Wholesale Mortgage
602-524-2454
FHA will not do a loan on a manufactured home in a flood zone unless a flood elevation survey is done to show that the land under the home and its mechanicals are above the flood elevation. This means, of course, that only part of the home’s lot is in a flood zone….and the part with the home on it is not. The old rule was that the living area of the home had to be above the flood elevation….not the land under it. So now these homes that qualified under the old rule but not the new one, are now ineligible for FHA financing.
VA- Follows FHA’s guidelines.
Conventional loans (Fannie Mae and Freddie Mac) “Flood insurance coverage is required for all residential buildings on the mortgaged premises if any part of the structure is located within an SFHA (Special Flood Hazard Area).” Insurance must be for 100% replacement cost of the improvements or for a minimum of the loan amount.
So, if the home is in a flood zone, conventional is the way to go!
Call if you have any questions:
Eric North
Arizona Wholesale Mortgage
602-524-2454
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