What does it mean to finance “chattel” for manufactured homes?

Financing "chattel" for manufactured homes specifically refers to loans secured by personal property rather than real estate. In this context, a manufactured home is considered personal property if it is not permanently affixed to a foundation and the land it occupies is not owned by the homeowner. This type of financing often involves shorter terms and possibly higher interest rates compared to traditional real estate mortgages, which are secured by real property.

Understanding chattel financing is crucial for manufactured home dealers and buyers because it influences the terms of the loan and the financial options available. This distinction is essential for both the loan structure and the tax implications associated with the property. Knowing that chattel loans are based on personal property helps dealers and prospective buyers navigate the financial landscape effectively and make informed decisions regarding their purchases.