Tiny House Financing: Personal Loans for Your Tiny Home
The market for tiny homes may be getting bigger, but financing options are limited to personal loans, builder financing and home equity loans.
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When buying a standard home, you’d typically get a mortgage. If you’re in the market for a tiny house — commonly defined as a home that’s less than 400 square feet — qualifying for a pint-size mortgage is unlikely.
The mortgage you need for a tiny home may be smaller than a traditional lender’s minimum loan amount, which can start at $50,000. Tiny homes can cost from $30,000 to more than $70,000. An additional challenge: The lender may require that your tiny home have a foundation on land you already own.
Here are options for financing a tiny home:
A personal loan from an online lender, bank or credit union.
Financing through a lender partnered with tiny home builders.
A home equity loan, if you own a primary residence.
An RV loan if your tiny house is mobile.
- 35+ personal loans reviewed and rated by our team of experts.
- 20+ years of combined experience covering personal loans and financial topics.
- Objective, comprehensive star rating system assessing 20+ categories and 70+ data points.
- Governed by NerdWallet's strict guidelines for editorial integrity.
- 35+ personal loans reviewed and rated by our team of experts.
- 20+ years of combined experience covering personal loans and financial topics.
- Objective, comprehensive star rating system assessing 20+ categories and 70+ data points.
- Governed by NerdWallet's strict guidelines for editorial integrity.
Tiny House Financing: Personal Loans for Your Tiny Home
9.06-35.99%
$1K-$40K
600
LendingClub allows borrowers to use funds toward a home purchase or other expenses. It also accepts joint loan applications.
- Minimum credit score: 600; average borrower score is above 700.
- Minimum income: None; lender requires proof of income. Borrower average is $100,000 per year.
- Maximum DTI: 40%.
- Minimum credit history: 36 months and two accounts.
- Origination fee: 3% to 8%.
- Late fee: 5% of payment or $15 after 15-day grace period.
- Insufficient funds: $15.
8.99-29.99%
$5K-$100K
None
SoFi offers multiple rate discounts, large loan amounts and extended loan terms. Borrowers can also apply with a co-borrower.
- Must be at least 18 years old in most states.
- Must be a U.S. citizen, permanent or non-permanent resident, including DACA recipients and asylum seekers.
- Must be employed, have sufficient income from another source, or have an offer of employment to start within the next 90 days.
- Acceptable income sources: Employment, spouse’s income, retirement, alimony, child support, Social Security payments and disability benefits.
- Origination fee: 0% to 7%.
- Late fee: None.
6.99-25.29%
$5K-$100K
660
LightStream personal loans can be used to purchase a tiny house or fund related expenses, such as land or a trailer. APRs for its tiny house loans range from 5.95% to 16.79%.
- Minimum credit score: 660, but can vary depending on the loan purpose and amount.
- Maximum debt-to-income ratio: 50%.
- Minimum credit history: 3 years.
- Income sources accepted: Employment, retirement, rental income, alimony, child support, Social Security payments and disability benefits.
- Must be a U.S. citizen or permanent resident who is at least 18 years old and has a U.S. bank account.
- Origination fee: None.
- Late fee: None.
7.99-35.99%
$2K-$50K
600
- Minimum credit score: 600.
- Maximum debt-to-income ratio: 70% including a mortgage.
- Minimum credit history: 3 years and 1 account.
- Acceptable income sources: Employment, household income, alimony, retirement, child support, Social Security payments and disability benefits.
- Must be a U.S. citizen or permanent resident and at least 18 years of age.
- Origination fee: 0.99% - 9.99%.
9.99-35.99%
$1K-$50K
580
- Minimum credit score: 580.
- Minimum number of accounts on credit history: One account.
- Maximum debt-to-income ratio: 75%, including mortgage payments.
- Minimum length of credit history: Two years.
- Minimum income requirement: None. Lender accepts income from alimony, retirement, child support, Social Security, disability benefits and other sources.
- Origination fee: 1.85% to 9.99%.
- Late Fee: $10.
- Failed payment fee: $10.
8.99-29.99%
$2K-$45K
640
- Minimum credit score: 640.
- Minimum annual gross income: $24,000.
- Maximum debt-to-income ratio: 40% or 70% including a mortgage.
- Minimum credit history: 2 years.
- Must be at least 18 years old.
- Must be a U.S. resident living in one of the states where the lender does business.
- Origination fee: Up to 9%.
- Late fee: $15.
- Non-sufficient funds fee: $15.
- Minimum credit score: 660.
- Maximum debt-to-income ratio: 50%.
- Must be a member of First Tech Federal Credit Union.
- Must provide a Social Security number and copy of your driver's license or other state-issued ID.
- Late fee: $29
LendingClub allows borrowers to use funds toward a home purchase or other expenses. It also accepts joint loan applications.
- Minimum credit score: 600; average borrower score is above 700.
- Minimum income: None; lender requires proof of income. Borrower average is $100,000 per year.
- Maximum DTI: 40%.
- Minimum credit history: 36 months and two accounts.
- Origination fee: 3% to 8%.
- Late fee: 5% of payment or $15 after 15-day grace period.
- Insufficient funds: $15.
SoFi offers multiple rate discounts, large loan amounts and extended loan terms. Borrowers can also apply with a co-borrower.
- Must be at least 18 years old in most states.
- Must be a U.S. citizen, permanent or non-permanent resident, including DACA recipients and asylum seekers.
- Must be employed, have sufficient income from another source, or have an offer of employment to start within the next 90 days.
- Acceptable income sources: Employment, spouse’s income, retirement, alimony, child support, Social Security payments and disability benefits.
- Origination fee: 0% to 7%.
- Late fee: None.
LightStream personal loans can be used to purchase a tiny house or fund related expenses, such as land or a trailer. APRs for its tiny house loans range from 5.95% to 16.79%.
- Minimum credit score: 660, but can vary depending on the loan purpose and amount.
- Maximum debt-to-income ratio: 50%.
- Minimum credit history: 3 years.
- Income sources accepted: Employment, retirement, rental income, alimony, child support, Social Security payments and disability benefits.
- Must be a U.S. citizen or permanent resident who is at least 18 years old and has a U.S. bank account.
- Origination fee: None.
- Late fee: None.
- Minimum credit score: 600.
- Maximum debt-to-income ratio: 70% including a mortgage.
- Minimum credit history: 3 years and 1 account.
- Acceptable income sources: Employment, household income, alimony, retirement, child support, Social Security payments and disability benefits.
- Must be a U.S. citizen or permanent resident and at least 18 years of age.
- Origination fee: 0.99% - 9.99%.
- Minimum credit score: 580.
- Minimum number of accounts on credit history: One account.
- Maximum debt-to-income ratio: 75%, including mortgage payments.
- Minimum length of credit history: Two years.
- Minimum income requirement: None. Lender accepts income from alimony, retirement, child support, Social Security, disability benefits and other sources.
- Origination fee: 1.85% to 9.99%.
- Late Fee: $10.
- Failed payment fee: $10.
- Minimum credit score: 640.
- Minimum annual gross income: $24,000.
- Maximum debt-to-income ratio: 40% or 70% including a mortgage.
- Minimum credit history: 2 years.
- Must be at least 18 years old.
- Must be a U.S. resident living in one of the states where the lender does business.
- Origination fee: Up to 9%.
- Late fee: $15.
- Non-sufficient funds fee: $15.
- Minimum credit score: 660.
- Maximum debt-to-income ratio: 50%.
- Must be a member of First Tech Federal Credit Union.
- Must provide a Social Security number and copy of your driver's license or other state-issued ID.
- Late fee: $29
» MORE: Best home improvement loans
Personal loans for tiny homes
Online lenders offer personal loans that can be used to finance all or part of a tiny house purchase. Loan repayment terms are shorter than mortgages — usually up to seven years — which means you may pay off your tiny home faster, but monthly payments can be high.
Lenders use your credit score and income to determine if you’ll be approved for a personal loan and at what rate. Annual percentage rates on personal loans are from 6% to 36%; borrowers with excellent credit scores (720 and above) will qualify for rates at the low end of that range.
Personal loans are unsecured and don’t require collateral, so you won’t lose your tiny house or another asset if you can’t repay the loan (although your credit score will take a hit).Use a home improvement loan calculator to determine your potential monthly payment and total interest on a tiny house loan.
Personal loans from a bank
Large national banks don’t usually advertise tiny house loans, but you may still be able to get one, especially if you bank locally and have a good relationship with your bank.
Bank loans have similar rates to online lenders, but some offer discounts or lower rates to existing customers. Banks prefer borrowers with good or excellent credit (690 or higher FICO).
» MORE: Compare bank loans
Personal loans from credit unions
Credit unions can be a good source for an unsecured tiny house loan, and building a relationship with a credit union can increase your chances of approval.
Credit unions are not-for-profit organizations that serve members who live or work in a particular area. You have to meet the requirements and pay a membership fee to join before you can apply for a loan.
Loans through a tiny house builder
Tiny houses may be financed through a lender that partners with a builder. These loans are either unsecured (based primarily on your credit score) or secured by the tiny house.
The potential benefits include low starting rates (typically under 10%) and longer loan terms (10 to 20 years or longer) than personal loans.
But this option may require a down payment of 20% or more of the purchase price. If the loan is secured, you can lose the tiny house if you can’t make payments.
Tiny homes on wheels may qualify for RV loans, but only if the vehicle is certified as an RV by the Recreational Vehicle Industry Association.
Home equity loans
Home equity loans and lines of credit are available if you own a home and want to add a tiny house to the land as an accessory dwelling unit or buy a mobile tiny home.
Home equity loans usually have low rates and long repayment terms (typically more than 10 years), which allow lower monthly payments. But you’ll need equity to qualify, and you can lose your primary home if you miss payments.
Tiny house financial risks
The benefits of a tiny house may include lower housing expenses and less upkeep. But factor these costs into your budget:
Purchasing land or leasing a lot.
Parking fees at campgrounds and fuel if you take your tiny home on the road.
RV insurance, construction insurance or homeowner’s insurance, property taxes and permit fees.
Propane tanks for a tankless water heater.
New appliances that fit the home.
Typical housing maintenance and repairs.
Last updated on December 12, 2023
Methodology
NerdWallet’s review process evaluates and rates personal loan products from more than 35 financial technology companies and financial institutions. We collect over 50 data points and cross-check company websites, earnings reports and other public documents to confirm product details. We may also go through a lender’s pre-qualification flow and follow up with company representatives. NerdWallet writers and editors conduct a full fact check and update annually, but also make updates throughout the year as necessary.
Our star ratings award points to lenders that offer consumer-friendly features, including: soft credit checks to pre-qualify, competitive interest rates and no fees, transparency of rates and terms, flexible payment options, fast funding times, accessible customer service, reporting of payments to credit bureaus and financial education. Our ratings award fewer points to lenders with practices that may make a loan difficult to repay on time, such as charging high annual percentage rates (above 36%), underwriting that does not adequately assess consumers’ ability to repay and lack of credit-building help. We also consider regulatory actions filed by agencies like the Consumer Financial Protection Bureau. We weigh these factors based on our assessment of which are the most important to consumers and how meaningfully they impact consumers’ experiences.
NerdWallet does not receive compensation for our star ratings. Read more about our ratings methodologies for personal loans and our editorial guidelines.
NerdWallet's Tiny House Financing: Personal Loans for Your Tiny Home
- LendingClub: Best for Tiny house personal loans
- SoFi Personal Loan: Best for Tiny house personal loans
- LightStream: Best for Tiny house personal loans
- Best Egg: Best for Tiny house personal loans
- Upgrade: Best for Tiny house personal loans
- Rocket Loans: Best for Tiny house personal loans
- First Tech Credit Union Personal Loan: Best for Tiny house personal loans
