Best Financing Options for Tiny Homes on Wheels (THOWs): A Real Guide to Getting Your Home Paid For

One of the biggest barriers to tiny home ownership isn't finding the home — it's figuring out how to pay for it. Traditional mortgages usually don't work for tiny homes. So what does? 
The good news: financing options for THOWs have improved significantly in recent years. Below, we break down what's actually available, how each option works, and which might be the right fit for your situation. We'll also connect you with our trusted lending partners to help ensure you make the most informed decision possible. And if you're not sure where to start, the Cocoon team is here to guide you through every step of the process — from understanding your options to finding the right fit for your budget and lifestyle.

Option 1: RV Loans 
If your THOW is RVIA-certified (certified by the Recreational Vehicle Industry Association), it may qualify for an RV loan. This is one of the better financing options available because RV loans typically have lower interest rates and longer terms than personal loans — sometimes up to 15–20 years. 
Requirements typically include: A credit score of 660 to 700+. A down payment of 10 to 20%. An inspection of the tiny home before the loan is approved. RVIA or equivalent certification. 
One important note: some RV lenders won't approve the loan if the THOW is intended as a primary residence. Others will. This is something to ask about directly before you apply. 

Option 2: Personal Loans 
Personal loans are the most flexible option — you can use them for almost anything, including a tiny home build or purchase. They're also the easiest to get approved for, often within days. 
The trade-off: higher interest rates (typically 8–15%+) and shorter terms (usually 1–7 years). That means higher monthly payments than an RV loan. Lenders like LightStream, SoFi, Best Egg, and Upgrade all offer personal loans that could work for tiny home financing. 

Option 3: Builder Financing 
Some tiny home builders work with lender partners to offer financing directly through their business. This can be convenient — one company handles both the build and the loan. But terms and rates can vary, so always compare with outside lenders before committing. 
At Cocoon Homes, we work with a couple of lender partners depending on the situation. If you connect with us, we'll help you navigate the financing process as much as we can — it's part of what we do. 

Option 4: Home Equity Loans and HELOCs 
If you already own a home with equity, a home equity loan or HELOC (Home Equity Line of Credit) can be a great way to fund a tiny home project — especially if the tiny home is going on your property as an ADU. Interest rates are typically lower than personal loans, and terms can be longer. 
The downside: you're putting your primary home up as collateral. Only do this if you're comfortable with that level of risk. 

Option 5: FHA Loans (Limited Applicability) 
FHA loans can technically work for tiny homes — but only if the home is at least 400 square feet, on a permanent foundation, and HUD-compliant. Most tiny homes on wheels won't qualify. But if yours does, it's worth exploring. 

Option 6: Land Loans 
If you need to finance land separately from the home, land loans are available — but they often have stricter requirements and shorter terms than home loans. Some lenders will roll land and construction costs into a single loan if you're doing a foundation build. 

Tips for Getting the Best Rate 
Get your credit score in shape before you start. Even a few points can make a meaningful difference in your rate. Get pre-qualified from at least 3 lenders so you can compare terms side by side. Ask your builder about their lender partners — they may have negotiated better terms. Consider the total cost of the loan, not just the monthly payment. A longer term means lower payments but more interest over time. 

For Developers and Larger Projects 
If you're building a tiny home community or workforce housing project, financing looks different. We work with developers on financeable, repeatable tiny home communities — and we can connect you with the right lending partners for those projects.

Navigating tiny home financing can feel overwhelming, but it doesn't have to. At Cocoon Homes, we work with you one-on-one to understand your situation, walk you through your options, and connect you with the right lending partners — so you can move forward with confidence. Reach out to us at mycocoonhomes.com and let's find the path that works best for you.

Financing details based on 2025 data from Rocket Mortgage, LendingTree, Bankrate, SoFi, and U.S. News. Rates and terms vary by lender and individual qualification.