Can You Finance a Tiny Home? Here's What You Need to Know

May 15, 2018

Those trendy 500-square-foot tiny homes sure are cute and it's a cool idea reduce your environmental footprint and embrace conscious "micro" living. But though these homes may be but little, they can be fiercely difficult to finance, since traditional home mortgages aren't always an option.

"Mortgage companies generally will lend only on homes with permanent foundations and where the homeowner also owns the land," says Holden Lewis, NerdWallet's mortgage expert. "If the tiny house is on wheels or if it's located on someone else's land, a mortgage company might not do business with you."

In addition, many mortgage companies don't offer loans under $50,000, since they don't offer a worthwhile financial kickback to the lender. But if you really, really want a tiny home (and don't have the cash to buy one up front) there are still options to finance. Here, three to consider.

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