Prefab Isn’t What It Used To Be

The history of prefabricated homes in the United States dates back to the early 1900s when companies like Sears, Roebuck and Co. sold more than 100,000 homes out of its catalog.  Prefabricated houses were inexpensive because the panels were constructed in an assembly line fashion, with the skilled carpenters, plumbers and electricians all in one factory rather than on site.  The lower cost of these homes, around $2500, meant that more middle-class Americans could afford to build a home.  Eventually prefab homes fell out of favor, partially due to the government imposing stronger building codes for design, construction, fire safety and energy efficiency.  However, in the past couple decades innovations have allowed manufactured home designers to cater to an increasingly upscale market with modern, “green” prefabricated homes.

This 4,500 square foot home in beautiful Oregon features one side made entirely out of translucent and transparent panels to take advantage of the views.  The other side is surfaced with recycled metal panels that provide privacy from a road and decreased construction costs.  The metal panels will eventually rust and the red color will resemble the red rock mountains nearby.  The interior is finished with renewable bamboo cabinets and bamboo and stained concrete floors.  The construction cost was $130 per square foot.

This custom modular home was erected on a lot in an existing urban neighborhood.  Three story homes from Method Homes range from 1592-2335 square feet and have a base price of $211,736.

Another Oregon home, this prefabricated home evokes a 1950s look but it’s anything but inside.  This 2300 square foot home has 12 ½” pitched ceilings and no interior supporting walls.  The rear of the home features 13” windows in every room.

Factory built homes aren’t just available for single family homes.  LivingHomes, based in Santa Monica, CA, has “installed” a multifamily property in San Francisco, CA featuring six townhomes with 2 bedroom floor plans.

This green home on the border of Joshua Tree National Park was manufactured by Blu Homes for Time Disney.  The home was “unfolded” on site and reportedly uses 50% less energy than a typical home.  Interesting fact: this home is actually two of the company’s “Origin” model joined together.


How To Save Money On Mortgage Payments

Financial advisors generally recommend spending in the range of 30% of a household’s monthly income on a mortgage payment.  Some homeowners have seen their incomes decline in the last few years and others may have budgeted more than 30% for their mortgage payments to begin with.  If you’ve found yourself in one of these positions, consider employing one or more of the following tips to get your monthly budget back on track.

Shop Around for a Better Rate

If your rate is above 4%, you may want to shop around for a better rate.  You can talk to your existing lender about refinancing or you can shop an online lender like AmeriSave.  Online lenders will often have very competitive rates because of the low overhead and operating costs associated with operating a brick and mortar brokerage.  Shopping for a rate and locking it in at is simple and fast.

Check current interest rates at AmeriSave here.

Kick Your Private Mortgage Insurance to the Curb

If your original loan was more than 80% of the home’s appraised value when you signed the agreement, then you are paying private mortgage insurance.  If you purchase a home for $200,000 with an $8,000 down payment and signed a 30 year fixed loan at 3.25%, then your payment would be approximately $835 per month plus an estimated $180 for PMI.  If you’ve lived in your home for a number of years or you feel that the value has increased to a point that the balance of the mortgage falls below 80% it may be wise to try to have your lender cancel out the PMI premium.  Most of the time, the homeowner will have to pay for an independent appraisal to determine the current value, but with the average appraisal cost between $400-$600, you would see big savings in just 2-3 months.

Check Into Government Sponsored Assistance Plans

If your current financial situation is making it difficult for you to make your mortgage payments or if you owe more than your home is worth, check into the following programs.

Home Affordable Modification Program (HAMP) – For borrowers who are employed, but are having financial difficulty making payments.  You must have obtained your mortgage before January 1, 2009, owe less than $729,750 and have sufficient income to support a modified payment.  Read more on HAMP here.

Principal Reduction Alternative (PRA) – For homeowner’s whose homes are worth significantly less than they owe, the program seeks to encourage mortgage investors to reduce the principal amount owed.  To be eligible, the same criteria listed above for the HAMP program apply, additionally, the mortgage must not be held by Fannie Mae or Freddie Mac, you must occupy the home as your permanent residence and your mortgage payment must be more than 31% of your pre-tax monthly income. Read more on PRA here.

Appeal Your Property Taxes

If you’re one of the millions of homeowners whose home value has decreased dramatically, check your property tax records to see if your home is over-valued by the county you live in.  If you feel the value is over-stated, you can appeal the value to the board of assessors and possibly receive a reduction in assessed value.  We can’t speak for every county, but generally you can back up your claims by obtaining a market analysis for comparable properties recently sold in your neighborhood.  Backing up these claims with a recent independent property appraisal will make your case stronger.  While you’re at it, check the property information card the county has on file.  This writer once found that the square footage had been incorrectly recorded by over 1000 sq ft. resulting in a refund of overpaid property taxes for two years!