Chattel loan calculator

One payment formula, written out

Both columns run through the same amortization function. The monthly payment is payment = A × r ÷ (1 − (1 + r)−n), where A is the amount financed, r is the annual rate divided by twelve and then by a hundred, and n is the term in months. If the rate is zero the payment is A divided by n. Each month the interest is the remaining balance times r, the rest of the payment reduces the balance, and the last payment absorbs the rounding so the schedule reconciles to its own summary to the cent.

What goes into each column

The chattel column finances the home price less your cash down. The real property column finances the home price, plus the land cost if you entered one, plus the closing and titling costs you entered, less the same cash down. The two columns therefore do not always finance the same amount, and the table says how much they differ by. If you already own the lot and entered nothing for land or closing costs, both columns finance the identical amount and the whole difference is rate and term.

The term effect

The term row re-runs the chattel rate on the chattel amount for the real property term. Subtracting that payment from the chattel payment leaves the part of the monthly gap that the shorter term alone causes. Subtracting the real property payment from it leaves the part that rate and amount financed cause. The two parts add back to the whole gap, which is the check that the split is real arithmetic and not a label.

The breakeven rate

Total paid rises steadily as the rate rises, at a fixed amount and term, so a bisection finds the single rate where the chattel total equals the real property total. The search is bounded between zero and one hundred percent, runs under a fixed iteration cap, and stops when the two totals agree inside half a cent. If the real property total lies outside what the chattel amount and term can reach at any rate in that range, the page reports no breakeven rather than a number pinned to the edge of the search.

You need six figures and two of them are optional. From the home purchase agreement, the home price and the cash down the lender is asking for. From the chattel offer, its interest rate and its term in months. From the real property offer, its interest rate and its term in months. If you are buying the lot as part of that second deal, its cost goes in the land box. If the second deal carries closing, survey, foundation or titling costs that are being financed and the chattel deal does not, they go in the last box.

Terms are usually written in years on an offer sheet and this page wants months, so multiply by twelve. Twenty years is 240 months, twenty three years is 276, thirty years is 360. If a lender has quoted an APR rather than a note rate, the two are not the same figure, and the payment the lender prints on the sheet is the one to reconcile against.

If you only hold one of the two offers, this page cannot supply the other one and will not invent it. You can still enter a rate and term you want to test against, and read the result as a question to take back to a lender rather than as a second quote.

The security is the home, not the land

The Consumer Financial Protection Bureau, in Manufactured Housing Finance, New Insights from the Home Mortgage Disclosure Act Data (May 2021), defines the two products directly. Chattel loans, it says, “are loans for manufactured housing that are secured solely by the manufactured home and not land, while MH mortgage loans are secured by the manufactured home and land.” The same report finds that “around 42 percent of manufactured housing loans are chattel loans, which are loans secured by the home but not the land.”

Personal property or real property is a titling question

The Department of Housing and Urban Development draws the same line inside its own Title I regulation. At 24 CFR 201.2, a manufactured home improvement loan is one on a home “which is classified as personalty by the State or locality in which the property is located”, while a home qualifies as real property when it “is placed on a permanent foundation, the home and lot are classified as realty by the State or locality in which the property is located, and any loans on the property are secured by mortgages or deeds of trust covering the home and lot.” At 24 CFR 201.24, the lender’s first lien on a manufactured home loan may be evidenced by “a properly recorded financing statement, a properly recorded security instrument … or another acceptable instrument, such as a certificate of title issued by the State and containing a recitation of the lender’s lien interest in the manufactured home.” A certificate of title is the same class of document a state issues for a titled vehicle, and it is not a recorded mortgage.

The consequence when a payment is missed

The CFPB report states the effect plainly. Chattel loans “are not covered by either the Real Estate Settlement Procedures Act (RESPA) or the Coronavirus Aid, Relief, and Economic Security (CARES) Act”, and “in the case of default, manufactured housing mortgages are eligible for the same foreclosure protections as traditional site-built homes, whereas chattel properties are not protected and instead go through repossession, a process with less consumer protections and less opportunity for the borrower to remain in the home, depending on the state and local protections.” The report adds that many chattel homeowners pay rent for the land under the home, and are therefore exposed both to repossession by the lender and to rent increases or eviction by the owner of the land. None of that is priced by the calculator above, which compares money only.

What the measured gap looked like in the data

The same report, working primarily from 2019 Home Mortgage Disclosure Act data, published median figures for both products. Median loan term was 23 years for chattel loans against 30 years for manufactured housing mortgages and 30 years for site-built mortgages. Median interest rate was 8.6 percent for chattel loans, 4.9 percent for manufactured housing non-chattel loans and 4.1 percent for site-built loans. Those are historical measured medians from one year of data, not current pricing and not an offer, and nothing on this page uses them. They are here only to show that the gap this calculator measures has been measured before, at national scale, by a federal regulator. Your own two numbers are the ones that decide your case.

Who is being offered this, and the term ceiling in the Title I program

The CFPB found that over 60 percent of manufactured housing borrowers directly own the land their home sits on, which means they may be eligible for a mortgage, and that 17 percent of those landowners took out a chattel loan anyway. If you own the lot and are holding a chattel offer, you are in that group, and the comparison above is the one that was not put in front of you. Separately, where a loan is insured under HUD’s Title I program, 24 CFR 201.11 caps the term of a manufactured home loan at “20 years and 32 days from the date of the loan”, a manufactured home lot loan at 15 years and 32 days, and a multi-module manufactured home and lot in combination at 25 years and 32 days. Most chattel lending is not Title I insured, so that ceiling is not a general rule, but it is one published place where a shorter maximum term for personal property lending is written down.

The manufactured home loan calculator prices one loan at a time from a single set of figures, which is what you want once you have decided which product you are taking. This page does something different, it holds two competing offers on the same home against each other and states the gap, so it is the step before that one rather than a repeat of it. The mobile home loan calculator covers the same arithmetic for a home in a park or on rented land, where a chattel loan is often the only product on the table. If you are buying the lot as a separate transaction, the land loan calculator prices that side on its own. A modular home is built to local code on a permanent foundation and is generally financed as real property in two phases, a construction draw period and then a mortgage, which is a different structure again. And a tiny house on wheels is usually financed more like a vehicle than like either product on this page.