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05/06/2024

Modular Home Definition: Modular Home vs. Mobile Home


A modular home in a rugged, sun-drenched landscape. Once completed, modular homes can be indistinguishable from traditional site-built homes.

Not all homes are built board-by-board on a construction site. Some of the most customizable and accessible real estate in the country are prefabricated homes made in factory environments. Mobile and modular homes are excellent options for Americans looking to buy a home with all the bells and whistles they imagined.

While you might have heard of mobile homes before, modular homes may feel a little less familiar. They could be amazing options if you’re looking to buy real estate soon! Let’s explore what a modular home is and how it compares to mobile homes constructed in similar settings.

Modular home definition

Put simply, a modular home is a prefabricated house mostly built in a climate-controlled factory environment. Once most of a modular home is built, its components are transported to its final site – whether that site is an empty lot in a neighborhood or a plot of land out in the countryside. There, they are assembled into the completed house.

In contrast, traditional site-built or “stick-built” houses are constructed completely on-site. Despite this key difference, modular homes are in no way inferior to traditionally built homes. They offer similar customization options, the same kinds of amenities and appliances, and good build quality. In fact, modular homes are constructed according to the exact same building codes as nearby on-site houses, ensuring that they offer the same durability, longevity, and protection from the elements.

How are modular homes built?

Modular homes are built in individual pieces called modules. Once those modules are finished, they are transported (typically in one or more trucks) to their destination. Upon arriving, skilled builders assemble the pieces of the modular home. After assembly, it’s usually impossible to tell the difference between a modular and traditional home from the curb or from inside either property.

A worker assembles a manufactured home in a manufacturing facility. Modular and manufactured homes are cost-effective alternatives to stick-built homes.

What is the difference between a manufactured home and modular home?

Manufactured homes are constructed in factory environments, too. However, there are some key differences between manufactured homes and modular properties. Here’s a list of those differentiating factors:

Manufactured homes
Modular homes
  • Technically mobile
  • Must be permanently affixed to real estate and title canceled to be considered real property
  • Limited financing options available
  • Built according to federal HUD codes
  • Not mobile
  • Considered real property as soon as construction is finished
  • Similar financing options as site-built homes are available immediately
  • Built according to local, state, and regional codes

To sum up, manufactured homes are built according to a different set of construction codes. Additionally, newly manufactured home owners have to file paperwork with local county offices to convert their mobile homes into more traditional real estate.

Modular homes don’t require the same legwork. When you purchase and move into a modular home, it’s exactly the same as buying and moving into a traditional house.

The most important difference is movability. A manufactured home can be moved, at least on paper. Modular homes are not intended to be moved at all after being installed on their permanent lots.

What is a modular home vs. mobile home?

Mobile homes are the same types of structures as manufactured homes. The terminology difference comes from the implementation of federal HUD code standards for the construction of new prefabricated real estate. HUD code standards for the construction of new prefabricated real estate.

Prior to 1976, prefabricated homes were called mobile homes. After the HUD code in 1976, all newly built, up-to-code prefab homes with the potential to be moved after installation were called manufactured homes instead.

These days, it’s common to see both terms used interchangeably. That means the differences between modular homes vs. mobile homes are the same ones between modular homes vs. manufactured homes.

The exterior of a modular home with a wide front porch surrounded by trees.

Benefits of modular homes

Modular homes offer several impressive features to homeowners, some of which are specifically due to how they’re built. Let’s take a closer look.

Customization options

Just because modular homes are built in factory environments doesn’t mean they all look the same. In truth, it’s the opposite.
Modular homes have extensive customization options for their future owners. Depending on what you want or need from your property, you can order a modular home to be built with different bedrooms, layouts, amenities, lighting fixtures, and much more. A modular home could become the home you’ve always dreamed of, built exactly to your specifications, rooms, layouts, amenities, lighting fixtures, and much more. A modular home could become the home you’ve always dreamed of, built exactly to your specifications.

Quality control

Since modular homes are constructed according to regional building codes, they’re always designed to withstand local weather elements and hazards. In essence, they’re durable and resilient against the same things as nearby site-built homes.

To make sure a new property is built to last, modular homes are always inspected and approved by local inspectors after they are installed at their final destinations. The builder's warranty that comes with modular homes provides even more peace of mind for owners, as well.

Energy-efficiency

Modular homes are highly energy efficient – and in some cases, they may even be more energy efficient than stick-built properties. Thanks to the effective insulation in the walls, doors, and windows of a modular home, the utility bill is often lower than an equivalent bill for an alternative house. In the long run, that can add up to hundreds or thousands of dollars in savings.

Financially accessible

Because modular homes are permanent fixtures on their lots, banks treat them as traditional real estate. For prospective owners, that means you may be able to get great mortgages with attractive rates, just like you could for a site-built house, especially if you partner with lenders like 21st Mortgage.

At the same time, modular homes could be more affordable and accessible for Americans struggling to find the right traditional house in the current market. Since modular homes have the same quality, amenities, and layout options as site-built houses, there’s no downside.

Appreciation value

Modular homes appreciate the same way as traditional real estate properties. When you buy a modular home, you can build up equity to open up new financial options for you and your family. For example, mobile or modular home equity loans allow you to borrow against the equity in your property for things like home renovations, vacations, and plenty of other reasons.

The modern, esthetically pleasing, customized kitchen of a modular home.

Looking at modular homes? Work with 21st Mortgage

A modular home could be just what you’ve been searching for in your house hunt. With their extensive customization options and other big benefits, they’re top choices for Americans looking to become homeowners.

You could qualify for accessible loans with great rates from a provider like 21st Mortgage. As one of the country’s most trusted mobile and manufactured home lenders, we’re proud to help aspiring homeowners like you purchase the perfect properties. Get in touch with one of our loan officers today to learn more.

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