Skip to Main Content

Housing prices have reached new highs this year—and with uncertainty of when they will be coming back down.

It’s no wonder that modular homes have emerged as a compelling housing solution, especially in rural areas where traditional construction may pose challenges.

The challenge of today’s housing market

Today, many first-time homebuyers are potentially getting stuck.

Rising market prices mean prospective buyers may not be able to find a home their family needs. Or, if they do find one, it’s beyond their price range. This leaves many buyers frustrated from a lack of options and wondering: How can I secure a home for myself and my family?

Modular home: A viable solution to higher housing costs?

Modular homes are different. Their major components are prefabricated in a controlled factory environment, then transported, and assembled on-site, ensuring a quicker and more efficient building process compared to traditional stick-built homes.

Segmented construction models like this may benefit individuals with average or lower credit scores, which often require a lower financial cost, making homeownership more accessible.

Additionally, the potential for a shorter construction timeline could mean reduced interim costs—increasing the potential for a satisfying outcome, both financially and personally, for potential first-time homebuyers.

With the right guidance, from the inception of the project through to its completion, a construction loan is an opportunity to simplify the path to acquiring a modular home.


Understanding modular homes vs manufactured homes

Modular homes, often mistaken for manufactured homes, are distinct housing options in terms of construction and regulation.

While both are built in factories, modular homes are constructed in sections or modules, which are then transported to the site for assembly. They adhere to the same local building codes as traditional, site-built homes and are placed on a permanent foundation.

On the other hand, manufactured homes, also known as mobile homes, are built on a non-removable steel chassis and adhere to federal guidelines.

Benefits of modular home construction

  • Financial advantages: Modular construction may be more cost-effective due to economies of scale achieved in a factory setting. The ability to control costs and adhere to a strict timeline may also translate to significant savings, making it an attractive option for individuals with average or lower credit scores.
  • Faster construction time: The indoor construction process allows modular homes to be completed in a fraction of the time it takes to build a traditional home. This expedited timeline not only means moving in sooner but also potentially reduces the costs associated with interim housing and construction financing.
  • Customization possibilities: Despite the prefabricated nature, modular homes offer a range of customizable options. Homebuyers can choose from various floor plans, architectural styles, and finishes, ensuring their new home aligns with their personal tastes and functional requirements.


The modular homebuying process

Whether you’re a repeat or a first-time homebuyer, it’s important to have a basic understanding of the process of securing a loan for a modular home, and how they’re built.

Building a modular home encompasses several steps that break down into the major areas of design, finance, and construction.

The process demands thoughtful consideration and planning to ensure a smooth transition from the vision of homeownership to reality.

Research and Education

The first step involves extensive research to understand the nuances of modular construction. Prospective homeowners should familiarize themselves with the various designs, sizes, and customization options available.

Additionally, understanding the zoning laws and building codes of the intended location is crucial.

Budgeting and financing

Establishing a budget is paramount. It’s highly advisable at this stage to consult with a lending institution to understand the loan options available.

Part of this consultation may explore construction-to-permanent loans—something specifically designed for modular home constructions, easing the financial transition from building to homeownership.

Selecting a manufacturer and design

Once the financial groundwork is laid, the next step involves choosing a reputable modular home manufacturer. Selection of design follows, where buyers can customize the layout and aesthetics to match their preferences.

Site preparation

Preparing the site itself is another fundamental step. This involves land purchase (if not already owned) and prepping the foundation for the modular home under the guidance of experienced contractors.

Modular construction and assembly

Modular sections are constructed in a factory-controlled environment, ensuring quality and adherence to timelines. Post construction, the modules are transported to the site for assembly, and necessary installations and inspections are carried out to ensure compliance with local building codes.

Move-in and post-construction care

Upon successful completion and inspections, homeowners can move into their new living space and enjoy all the benefits, responsibilities, and feeling of having a place to call home.


Why experienced lenders are essential for modular homes

The Federal Savings Bank alleviates many challenges associated with the modular home buying process by providing the entire construction process in-house.

Our unique approach streamlines the journey from conception to completion, providing a seamless experience for the borrower.

Dedicated guidance

One of the significant advantages is the continuity of working with the same dedicated team and specialists throughout the process.

This consistency fosters a deeper understanding of the borrower’s vision, financial circumstances, and any unique requirements they may have.

Avoids misunderstandings between groups

Keeping the loan process in-house also eliminates the need to monitor communication between different entities, which can often become a source of stress, delays, and additional costs.

Experience where it counts

The Federal Savings Bank provides experienced guidance and clear communication at every step in the loan process, meaning quicker resolution of any issues that may arise during the construction process. This not only saves time but also helps in maintaining the budget, making the path to homeownership via modular construction a well-coordinated and less daunting venture.


Modular home solutions with The Federal Savings Bank

Modular homes present a viable and attractive pathway to homeownership, especially for those facing geographical or financial constraints.

The streamlined construction, affordability, and customization possibilities of modular homes are unparalleled advantages.

The Federal Savings Bank offers a comprehensive in-house construction loan process, ensuring a consistent and supportive experience from application to close on your loan.

With helpful guidance available at every step, the fears you might have surrounding approval, construction loans in general, and what to expect from The Federal Savings Bank during the building process.

Now, with a clearer understanding and insight into modular home construction and financing, taking the first step towards building your dream home is within reach.

Start by reaching out to The Federal Savings Bank team.

Seize the opportunity to make informed decisions toward securing a comfortable place to live for a healthy, bright future for you and your family.



Subject to credit approval. Terms and conditions may apply. Property insurance is required on all loans secured by property.

This article is intended for general informational and educational purposes only and should not be construed as financial or tax advice. For more information on financial planning or investment advice, consult a registered investment advisor or financial planner. For tax advice, please consult a tax professional.

This information is intended for educational purposes only. Products and interest rates subject to change without notice. Loan products are subject to credit approval and include terms and conditions, fees and other costs. Terms and conditions may apply. Property insurance is required on all loans secured by property. VA loan products are subject to VA eligibility requirements. Adjustable Rate Mortgage (ARM) interest rates and monthly payment are subject to adjustment. Upon submission of a full application, a mortgage banker will review and provide you with the terms, conditions, disclosures, and additional details on the interest rates that apply to your individual situation.