How Do I Finance my Tiny House?

Tiny houses are a tricky thing to buy.

For one, not many tiny house builders can offer financing through their company and two, it’s hard to find financing through banks or other lenders because tiny houses are in such a legal gray zone. You will not be able to take out a traditional mortgage on a tiny house.

On top of that, builders may expect payments in lump sums so it can be hard to free up the money all at once.

At Tiny House Crafters, we are unable to offer financing for our models or accept payments in installations after delivery - we do not offer rent-to-own options. We are a small and young company that cannot be backed by a bank and we don’t have the ability to take risks on our clients or accept payments that aren’t in full.

Some larger tiny house companies might be able to help you out with financing without having to go through a bank.  

If you buy a tiny house from a professional tiny house builder or on the secondary market, expect the price tag to be between $40,000 and $80,000 depending on the size and the amenities you need to be comfortable. If you had that kind of money readily available, it might make more sense to put down a down payment on a small cabin or land where you can build on a foundation and invest in site improvements. It might even make sense to buy an RV since you can get a loan for those.

But if a tiny house on wheels is the right answer for you, there is still hope. The best thing to do is to check with your current bank and to see if they will approve you for a personal loan. Next, try local credit unions. Many are willing to lend if you are willing to switch your banking over to them.

If you aren’t having luck locally, try LightStream Tiny Home Financing

Some people might be able to lean on family to help. Older or more generous family members may be willing to take out a home equity loan or a personal loan in their name and let you pay them back.

One thing to remember is that the total cost of your new tiny house lifestyle will likely be more than what your builder quoted you for just the house. Depending on the agreement you have with your builder, there will be site specific set up that is probably not included in the package of your home. You will likely be responsible for your own skirting insulation, wheel chocks, and stabilization jacks. You may want to install an awning over your front door to protect your entryway and allow you to dry off before going into the house - and this might require a porch. You might want to upgrade your propane tanks or install window boxes. Some tiny houses may not even come with steps to get inside! Discuss these items with your tiny house builder before signing a contract if need assistance planning for site setup.

On top of all that, you will also have to deal with the expenses of moving your belongings and your tiny house to its parking location. Will your tiny house builder include delivery? Will you have to invest in a vehicle that can pull your house if you want to move it often? What kinds of personal storage solutions will you need to include when you move into the house? All of these questions can add to the total cost of moving into a tiny house past the purchase of the tiny house unit itself by hundreds if not thousands of dollars.

Not to mention how much it will cost to secure the land and how much it will take to improve it to your specifications and be in compliance with the law.

Read more about how to find parking here.

One questions I get all the time is: why do tiny houses cost so much?

I get many replies to our quoting system with astonishment and occasionally anger. Many people have seen online or on TV that tiny houses are simple and cheap. Shouldn’t something that’s a fraction of the size of a traditional house also be a fraction of the cost as well?

Yes, it is possible to build your own tiny house with reclaimed materials on a small budget and many people do! It’s a fantastic way to reuse resources and put skills to work. However, most people do not have the time, skills, tools, or building location needed for such a large undertaking. Therefore, they must look to professionals to build their homes. If you are hiring a professional to build your tiny house, you must fairly compensate them for their time and the resources they have invested in order to offer their services to you.

If professional services seem too expensive for you, perhaps you will be better served if you build your own or buy an already made house from tinyhouselistings.com!

If you find the cost of a brand-new and custom home to be shocking, please take the time to read this Tiny Life article, The Fallacy of a Cheap Tiny House.

So what's next? Get a custom tiny house quote from Tiny House Crafters! I'll be happy to walk you through your quote and answer your questions!