Financing the tiny house…

Happy Thursday! Woot, woot! We’re almost to the weekend again. =)

So today, I thought I’d tackle the budget question.  When I first got my tiny house (I have a picture hanging on my office door) people would often stop and ask about it – which was my plan with the photo placement – and one of the most common questions I would get asked is, “how much did it cost?”.

Well, before I spill the beans, I need to explain the whole tiny house funding scenario.

Most tiny houses are not considered RVs (recreational vehicles), however, some builders (like the big ones such as Tumbleweed) do build RVIA certified tiny houses.  I think they even call them Tiny Home RVs.  RVIA certified means that the house has an RV VIN number and is therefore considered an RV.  The RVIA certification is attained by a builder and not necessarily an individual because of the inspection and verification process.  Thus that is why only large (and a only a few) companies currently have the RVIA certification.

At the tiny house jamboree I discovered NOAH (National Association of Alternative Housing).  You can read all about them in this pdf.

http://americantinyhouseassociation.org/wp-content/uploads/2016/02/NOAH_certification.pdf

NOAH is a trade organization to represent tiny house on wheels (THOW) builders and suppliers.  They have a program in which an individual, who might be building their own THOW, can get their project RVIA certified which means it’s been inspected and built to certain standards.  Through this program the individual sends a video of their build during various stages to this organization.  The organization reviews the build process like the electrical wiring for example and verifies that it has been built to code, just like if an inspector was to come to a construction sight.   If all inspections pass, at the end of the build, the tiny home is RVIA certified. This video explains it better. =)

Why is this important when discussing budget?  Well, tiny homes are not considered a “home” according to a bank and do not qualify for a mortgage.  If a tiny home is an RV then someone can get an RV loan to make the purchase. Boom, done!  However, if a tiny home is NOT an RV – such as my case – then other forms of payment are needed.  When I was looking into this two years ago, some tiny home owners started asking friends and family to borrow money, others set up fund-me accounts online, while others put their purchase on a credit card, and others saved and paid cash outright for theirs.

In my case, I was a grad student, had been wanting a tiny house for years, and was finally in the right place in life to make it happen, decided that taking out a short term personal loan (for half of it) would be the best choice.  My builder referred me to a lender that supports tiny house builds – I got turned down by a few banks because they don’t support tiny houses (if it’s a personal loan why do they care what it’s for???). Anyways, a bonus of this lender is that if you have great credit you get a really low interest rate!  So I currently have a 5 year loan on my tiny house (1 year is almost done!) and will be debt free after that if not sooner!

So how much did I pay for my build you ask……. check back tomorrow to find out as I have more to discuss on this topic. =)

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