Sara Routhier, Managing Editor and Outreach Director, has professional experience as an educator, SEO specialist, and content marketer. She has over five years of experience in the insurance industry. As a researcher, data nerd, writer, and editor she strives to curate educational, enlightening articles that provide you with the must-know facts and best-kept secrets within the overwhelming world o...

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Written by Sara Routhier
Director of Outreach Sara Routhier

Joel Ohman is the CEO of a private equity-backed digital media company. He is a CERTIFIED FINANCIAL PLANNER™, author, angel investor, and serial entrepreneur who loves creating new things, whether books or businesses. He has also previously served as the founder and resident CFP® of a national insurance agency, Real Time Health Quotes. He also has an MBA from the University of South Florida. ...

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Reviewed by Joel Ohman
Founder, CFP® Joel Ohman

UPDATED: Jun 3, 2021

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  • Tiny house financing may be difficult to find, but it is possible
  • Some lenders may provide mortgages, but these will likely be the most difficult to find
  • Personal loans are an unsecured option, but interest rates may be higher than other products
  • You may also be able to use a home equity loan, home equity line of credit, RV loan, or builder financing

The tiny house movement is growing in popularity, influencing people to downsize their homes and live with less.

While they may be cheaper than larger, traditional homes, tiny house financing can be a little more challenging to find. Read below to learn about some financing options, such as personal loans or mortgages.

Before jumping into this review on tiny house loans, enter your ZIP code above to compare rates from lenders near you.

How can I get tiny house financing?

Tiny home financing may be a little harder to find than financing for a traditional home, but it is still possible. You may need to compare lenders and financial products to see who has a loan that would work for your needs.

Finding a mortgage may be difficult to find due to minimum loan amounts, appraisal requirements, and property size requirements. However, you may be able to find a mortgage that would work.

If you do, you may have higher interest rates and shorter terms since your loan will be smaller.

Personal loans may be an option for those with good credit. However, interest rates are often higher, and terms are often shorter, meaning your monthly payments may not be affordable.

However, they don’t require collateral, so your assets wouldn’t be at risk if you default on your loan.

If you own a home already, you may be able to use a home equity loan or home equity line of credit to pay for your tiny house.

However, this means that if you miss payments, your primary home could be seized by the creditor. The amount you’re allowed to borrow could also be limited.

If you’re building your tiny home on wheels, you could consider using an RV loan to finance your purchase.

This would allow you to have a longer loan term, but you would need your home certified as an RV, and your tiny home cannot be your primary residence.

You may be able to find a lender that partners with a tiny house builder to offer financing. These loans are either unsecured or secured by the tiny house, and you may need to make a down payment.

However, you may be able to get lower interest rates and longer loan terms.

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What else should I consider?

According to HomeAdvisor, the average cost of a tiny home is $45,000. However, the price of a tiny house is not the only factor you’ll need to consider. While you will reduce some housing expenses, other housing expenses may increase.

If you’re building on a foundation, you’ll need to purchase or lease land to build on. If you buy a pre-built tiny house, you may need to pay for transportation and setup.

If your tiny house is on wheels, you’ll need to consider fuel and parking fees.

You may also need or want to buy RV insurance, construction insurance, or homeowner’s insurance, as well as taxes or permit fees.

Inside your home, you may need to pay a little more to get smaller appliances that will fit. You may also have additional laundry expenses and propane costs. You may also need to rent a storage unit for things that won’t fit in your tiny house.

If you need help finding tiny house financing, enter your ZIP code into our free comparison tool below to find lenders near you.