Deciphering the VA Lender’s Handbook Chapter 14 Part 8
The VA is only willing to guarantee manufactured homes if they are affixed to a permanent foundation and are classified as real estate. However, even under these two circumstances, manufactured homes are different from normal homes. In the case of construction inspections, manufactured homes are actually much simpler and worry-free. There’s actually a lot to be said about getting a manufactured home; it’s usually cheaper than buying a home, certainly cheaper than building your own home, and is much simpler in a lot of ways – especially when it comes to construction inspections.
Manufactured homes come in two flavors: those that have yet to be attached to a foundation on a lot and those that have been. We’ll cover both in this article. For a home that has yet to be attached, and is going to be attached as part of the loan, the first inspection is very simple; the inspector merely needs to make sure that the house is attached to the foundation properly. The second inspection on a manufactured home is skipped completely, since everything it would normally check is done in a factory and every state makes sure that manufactured home superstructures are built to code. In the third inspection, if there are any onsite or offsite improvements being made in addition to bringing in the manufactured home, they will need to be checked to make sure they are properly completed.
As you can tell, purchasing a new manufactured home is very simple from an inspection standpoint. Since manufactured homes are tested and regulated in-factory, not much needs to take place once it’s on the lot. Now, things get a little bit more complicated if you’re purchasing a used manufactured home and you’re moving it to a different lot. This situation doesn’t come up very often, since leaving a manufactured home on its own lot makes it essentially the same as buying a standard house. When a manufactured home is moved, there are four special inspection reports that need to be done to make sure the home is safe for habitation. These reports are: a Water-Plumbing Systems Inspection Report, an Electrical Systems Inspection Report, a Fuel and Heating Systems Inspection Report, and a certification that the roof was coated after set-up on the new site.
The nice thing, though, is that these inspections do not need to be conducted by an assigned VA inspector – they are usually done by their various subject-matter experts. In other words, a plumber fills out the plumbing report, and electrician fills out the electrical report, and so on. All these reports need to be done after the home has been installed and set up on the new lot. The roof coating certification can be made by the lender. The VA simply requires that a “qualified inspector” performs the inspections on each of the different systems. Usually this means plumbers, electricians, etc. but it can also mean other personnel. For example, while a plumber can only perform the plumbing inspection, a licensed manufactured home service personnel can perform any and all of the required inspections. The responsibility of ordering the inspections rests with the lender, but will probably require at least some coordination on your part. If any of the inspections performed on the home are unsatisfactory for whatever reason – done by an unqualified individual, filled out incorrectly, or the home does not meet the requirements of the inspection, then the home will not be eligible for the VA guaranty. In order to be eligible, the home needs to pass every inspection, and each inspection needs to be done properly by a qualified individual.
If you are interested in finding out what’s on the reports, the plumbing report is VA Form 26-8731a, the electrical systems report is VA Form 26-8731b, and the fuel and heating report is VA Form 26-8731c. They are all available for viewing and download on the VA website.
If you have any questions about construction inspections and whether they’re required for the work you want to do with cash out from a refinance, give us a call here at Low VA Rates or contact us via our website.