The FHA loan is a government insured loan which allows a little more flexible modular home construction loan than the conventional loan. FHA loans do have a few more requirements than the conventional loan, such as mortgage insurance. The FHA loan is geared for the buyers with low down payments and average credit.
The FHA loan program offers two loans, one for home improvements and another for purchase of a modular home, for those who might not otherwise qualify for a conventional loan. That is the reason why it seems there’s nothing the government won’t do to encourage modular home ownership or modular home customization.
FHA approved lenders in Michigan make loans to eligible borrowers to finance property customization or purchase of a modular home, and HUD insures the lender against loss if the borrower defaults. Credit is granted based on the applicant’s credit history and ability to repay the loan in regular monthly payments.