CHOICEHome ® Mortgage: Conventional Financing for Premium Factory-Built Homes
What Is a CHOICEHome®?
CHOICEHome® is an innovative mortgage offering for financing real property factory-built homes, built to HUD Code requirements, with many of the same features as site-built homes. When a single-section or multi-section factory-built home meets certain specifications, it’s granted a CHOICEHome certification and is eligible for CHOICEHome financing. This allows you to use the same underwriting parameters as site-built homes.
Homes certified as CHOICEHome — also known as CrossMod® homes in the manufactured housing industry — are appraised like site-built homes, financed with conventional loan products and eligible for down payments as low as 3% through Home Possible® or HomeOne®.
A CHOICEHome must be built to the HUD Code and must also meet Freddie Mac's additional architectural and structural specifications, including:
- Aesthetic and architectural attributes comparable to site-built homes (pitched roof, covered porch, eaves, etc.)
- Minimum insulation values: R-33 ceiling / R-11 wall / R-22 floor
- Energy efficiency features exceeding current HUD requirements for the geographic area
Disclaimer
The information on this page is not part of, and is not a replacement or substitute for, the requirements found in the Freddie Mac Single-Family Seller/Servicer Guide and your other Purchase Documents.
Product Features
- Property Type/Eligible Properties
- 1-unit, factory-built HUD-code home
- Primary residence
- Designed as a single-section or multi-section property
- Meets Freddie Mac CHOICEHome or Fannie Mae MH Advantage® minimum specifications.
- Eligible Mortgage Products
- Fixed-rate mortgages
- 5/5, 5/1, 7/1, 10/1, 5/6-Month, 7/6-Month or 10/6-Month ARM; provided, however, Freddie Mac Home Possible® and Freddie Mac HomeOne® Mortgages must be fixed-rate Mortgages.
- Mortgages secured by a CHOICEHome subject to resale restrictions are eligible for purchase
- Transaction Type
- Purchase
- No cash-out refinance
- If mortgage proceeds are used to replace an Interim Construction Financing, the transaction must meet the requirements of Guide section 5703.12.
- Maximum LTV Ratios
- 95% LTV/TLTV/HTLV
- 97% LTV, 105% TLTV with an affordable second (Home Possible® and HomeOne®)
- Execution Options
Cash, Guarantor, and MultiLender
*Cash Released XChange is not available for CHOICEHome properties in Connecticut and New York
- Credit Fees
Manufactured home credit fee in price is waived for a CHOICEHome® mortgage
- Delivery Requirements
- Investor Feature Identifier: J15
- Construction Method Type: Manufactured
- Manufactured Home Width Type: Single-section or Multi-section
- Loan Manual Underwriting Indicator: False
- Eligible Offerings
Some included offerings are Home Possible®, HomeOne®, HeritageOne®, CHOICEReno® and Construction to Permanent Mortgages.
CHOICEHome vs. Standard Manufactured Home: Key Differences
| Feature | Standard MH Mortgage | CHOICEHome Mortgage |
|---|---|---|
| Appraisal standard | Manufactured home comparables required | Site-built home comparables (Form 70B) |
| Minimum down payment | Varies by product | As low as 3% (Home Possible®, HomeOne®) |
| Loan Product Advisor® (LPA®) submission | As manufactured home | Must select:
|
| HomeOne eligibility | Not eligible | Eligible |
| Community Land Trust | Not eligible | Eligible |
| Resale restrictions | Not eligible | Eligible (with standard resale restriction requirements) |
| Architectural requirements | HUD Code only | HUD Code + CHOICEHome specifications |
Eligible Loan Products for CHOICEHome
- Fixed-rate mortgages
- ARMs: 5/6-Month, 7/6-Month, 10/6-Month (fixed-rate required for Home Possible and HomeOne)
- Home Possible (down payment as low as 3%)
- HomeOne (first-time homebuyer, down payment as low as 3%)
- HFA Advantage®
- Construction to permanent (single-close and two-close)
- Mortgages subject to resale restrictions
How to Identify a CHOICEHome
A manufactured home is identified as a CHOICEHome by a certification label affixed to it in the factory where it is built. This label confirms the home meets all CHOICEHome manufacturing eligibility requirements. Lenders will be responsible to verify the site requirements for CHOICEHome have been met. The label indicates the home meets the requirements and the lender, through the appraisal, must verify the on-site requirements are complete.
Resources for Borrowers
Reaching and educating borrowers – and helping them find the right mortgage – is essential for your business. Freddie Mac provides an array of materials you can share with your clients and business prospects.