Mobile Home Chattel Loan Calculator

How it works

A chattel loan is not a mortgage. It is a personal property loan, closer to the way car finance works. You take one out when you own the mobile home but not the land under it.

Rent the lot and there is no real estate for a lender to hold, so the home itself is the collateral. You finance the price minus your down payment, and one level payment covers each month's interest plus part of the principal.

• M — the level monthly payment
• P — the amount financed, price minus down payment
• i — the monthly rate, the APR divided by 12
• n — how many payments you make, years × 12

With the defaults, a $95,000 home with $9,500 down leaves $85,500 financed. At 8.75% over 20 years that is 240 payments of about $756. The total comes to roughly $181,337, of which $95,837 is interest.

Home ownership on a rented lot costs more than the home itself here. So is the lot rent really cheaper than land and a mortgage?

✓ Every result is checked against independent reference math. See how we test the calculators →

How to use this calculator

1. Enter the price of the mobile home, or the payoff figure the seller quoted you.
2. Add your down payment, either as a dollar amount or as a share of the price.
3. Type in the APR the lender quoted you, not the teaser rate from an advert.
4. Set the term in years, which on a chattel loan usually runs 15 to 25.
5. Read the monthly payment, then use the payoff chart to see how slowly the balance drops in the first few years.

A worked example: a $95,000 home on a rented lot

Say you have found a manufactured home for $95,000 in a community where you will rent the lot. You put $9,500 down, a tenth of the price, and a lender quotes 8.75% over 20 years, which is a perfectly normal-looking chattel offer. You are financing $85,500, and the payment lands at $756 a month.

Follow it to the end and the total is the part that stings. Across 240 payments you hand over $181,337, and $95,837 of that is interest. The interest costs more than the home did.

Counting your down payment, the whole thing runs $190,837 for a $95,000 home, and none of that includes the lot rent you owe every month on land you will never own.

Now change one number. Leave the price, the down payment, and the 20-year term alone, and drop the rate to 6.5%, roughly what a real-estate mortgage might carry if you owned the land and the home were titled with it. The payment falls to $637 and lifetime interest drops from $95,837 to $67,492.

That gap is the price of the missing land, and it is why buying the lot is worth investigating. Put your own quote in above and see where you land.

Why is the rate higher than a mortgage rate?

Land is the reason. A mortgage is secured by real property that holds its value, while a chattel loan is secured by a structure on rented ground. That structure usually loses value as it ages.

Lenders price that difference, so chattel rates run several points above mortgage rates, and terms stop near 20 to 25 years. But the short term is not the expensive part. Stretch this loan to 30 years and the payment falls to about $673, while the total interest you pay climbs to roughly $156,646.

Half a point on the interest rate matters more here than it would on a house. So get every quote in writing, and compare them over the same number of years.

What does lot rent add to the payment?

This calculator prices the loan, not the land. Lot rent is a separate bill that never pays anything down, and it keeps arriving long after the last payment.

• Your loan payment is fixed for all 240 months, but the lot rent renews at whatever the community sets.
• Moving a mobile home is costly, so you have little leverage when that rent goes up.
• Many states charge a personal property tax on the home, billed once a year rather than inside the payment.
• Insurance and the utility bills sit outside the loan, so put every one of them in the same monthly budget.
• Some communities add fees for water, trash or pad maintenance that no lender counts when it sizes your loan.

Can you trade the chattel loan for a mortgage?

Mobile homes usually lose value as they age, so the balance you still owe can sit above what the home is worth for years.

A home permanently affixed to land you own can often be retitled as real property. That change of title lets you refinance at a mortgage rate instead of a chattel rate. Owning the lot brings property tax and upkeep with it, though.

Most lenders also want the wheels and hitch gone and the home set on a permanent foundation. Even then, run a mortgage calculator on the same balance and compare the two payments before you pay for an appraisal.

What do lenders check before they approve you?

A chattel lender checks less than a mortgage lender does, but the review is not loose. Credit scores set which rate band you land in, and a larger down payment usually moves you into a better one.

The home gets checked as closely as you do. Most lenders set an age limit and want it built to the HUD Code. An older unit is hard to resell if they ever have to repossess it.

Then come the rest of your bills. Add the lot rent, the insurance and any car payment to the figure here. You can also work backwards from a payment you can actually afford.

Checking a chattel lender's license

Chattel lending is a much smaller market than mortgage lending, so check the lender before you fill in an application. Look up its NMLS number on NMLS Consumer Access, and expect an Equal Housing Lender notice on the website.

In California, these companies are licensed by the Department of Financial Protection and Innovation (DFPI). The DFPI takes complaints. A lender's site should also carry a California Consumer Privacy Act notice, which explains what happens to your data.

Fewer companies will lend on a rental property than on the home you live in. The ones that do treat a rental property as the riskier deal. The CFPB's consumer tools cover what to ask before you sign anything.

Paying a chattel loan off early

Nothing stops you clearing this loan ahead of schedule. But read the note for a prepayment penalty first. The rules on personal property lending are thinner than the ones on a mortgage.

Over 240 months the early payments go almost entirely to interest. So an extra dollar of principal now cuts far more cost than the same dollar does five years in. Adding to each payment shortens the term, and the month by month schedule shows how much that saves.

Waiting to refinance is the weaker plan. Fewer lenders compete for this business. The rate you sign today is likely the rate you keep until the home is paid off or sold.