Mobile Home Equity Loan - Is It Possible?

Representative example: If you borrow £34,000 over 15 years at a rate of 8.26% variable, you will pay 180 instalments of £370.70 per month and a total amount payable of £66,726.00. This includes the net loan, interest of £28,531.00, a broker fee of £3,400 and a lender fee of £795. The overall cost for comparison is 10.8% APRC variable. Typical 10.8% APRC variable

Are you thinking about a mobile home equity loan? Is it possible in the UK? This article aims to answer your questions and ease your worries. We’ll explore:

What a home equity loan is
The real cost of a bad home equity loan
If you can release equity on a mobile home
Why some lenders don’t consider mobile homes
Other options to a mobile home equity loan

It’s normal to feel unsure about this big step. Over 6,900 people, just like you, visit our website each month seeking guidance on secured loans.

We know it’s a big choice, but we’re here to help you understand all about mobile home equity loans. Let’s get started!

Can you release equity on a mobile home?

Most lenders don’t offer home equity loans against mobile homes. They are usually only on offer to conventional freehold and leasehold properties.

Can I release equity on my park home?

Lenders rarely offer home equity loans on park homes, which are also a type of mobile home. However, there are alternative borrowing options if you have a mobile/park home and need credit.

Lender	APRC	Monthly payment	Total amount repayable
United Trust Bank Ltd	5.99%	£218.73	£26,247.92
Pepper Money	6.86%	£220.24	£26,429.17
Together	6.95%	£220.40	£26,447.92
Selina	7.5%	£221.35	£26,562.50
Equifinance	7.7%	£221.70	£26,604.17
Spring	10.5%	£226.56	£27,187.50
Loan Logics	11.2%	£227.78	£27,333.33
Evolution	11.28%	£227.92	£27,350.00

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Why don’t home equity lenders consider mobile homes?

Lenders don’t typically offer home equity loans on mobile and park homes because there is a greater risk that these property values will depreciate.

Park homes generally make for great retirement or holiday homes, but the value of these properties are more likely to decrease than standard houses and flats.

Alternatives to a mobile home equity loan

It might be really difficult to find a lender willing to offer you a mobile home equity loan, but there are other ways to source credit. You could:

Consider unsecured lending

There might be personal loans and credit cards that can offer you the amount of credit you need. However, unsecured lending is usually used to access smaller amounts in contrast to home equity loans, so they might not be a good option for you.

Consider other secured loans

Other types of secured lending might offer you larger amounts of credit, depending on what is being used as security. Most secured loans are secured by a property, but you can find them to be secured by other assets, typically vehicles. So there may be some options out there with secured lending.

Refinance your mortgage

If you were approved for a mortgage to buy your park home – which can be challenging in itself – you could refinance the existing mortgage to borrow more.

This is when you remortgage and simultaneously extend your mortgage to receive a lump sum payment, which can then be used as needed. However, extending the mortgage will mean it’ll take longer to pay back.

Consider selling

If you need the money urgently for a reason not connected to the property, you might want to consider selling your mobile home to raise funds. This will only be a viable option if the mobile home is an investment property or holiday home, rather than your main residence. It may be worth considering for some people.

Consider debt solutions (if looking to consolidate debts)

One of the reasons people use a home equity loan is to consolidate existing debts elsewhere. By tying up all their debt against their home, they can reduce their number of creditors and possibly secure a better interest rate to save money.

If this was your reason for trying to get a home equity loan, there are other debt solutions available. Read our debt solution guide to uncover further options.

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Can you use equity release schemes on a mobile home?

Another question that gets asked a lot is if you can take out an equity release scheme on a park home.

This isn’t the same as taking out a home equity loan on a park home because home equity loans and equity release aren’t the same, although sometimes they are mistakenly used interchangeably.

So first of all, what is the difference between home equity loans and equity release?

The former is as explained above, while the latter is a type of loan taken out by people over 55 (at least!) who own 100% of their home outright. They receive a loan and don’t make repayments. The loan is only repaid from the sale of their property, which can only be sold after they pass away or move into a long-term care residence.

The Equity Release Council is a governing body of equity release plans in the UK and is designed to keep homeowners more protected when using these schemes. But they do state that lenders don’t usually offer equity release on mobile and park homes.

This is also due to the greater possibility of the home decreasing in value.