[CITY] Mortgage News

Section II: Methodology
CCRH began this study with interviews of strategically selected affordable housing developers and housing program administrators to help scope out manufactured housing development issues and usage within California. These interviews yielded potential case studies and also informed the next phase of the research process – a developer survey regarding experience with manufactured housing.
In the survey, developers were queried about their use of manufactured housing and their perceptions of it. Developers who had not completed a manufactured housing project were questioned about the reasons they had not developed with it and their perceptions of the advantages and disadvantages of manufactured housing. For developers who completed projects, CCRH inquired about the types of projects they developed, their experience with the development process, overall satisfaction with the manufactured housing, and what they perceived as its strengths and weaknesses.
Through the strategic interviews and developer survey, CCRH identified key issues pertaining to the successful employment of manufactured housing for affordable applications, formed criteria to select case study projects, and compiled a case study short list of prospective ownership and rental manufactured housing developments. CCRH then conducted site visits for developments on the short list and interviewed staff regarding their experience with manufactured housing.
Based on the first round of project interviews and site visits, CCRH then selected the six case studies that are presented in this guide. These developments were selected because they were representative of common affordable housing applications, offered important lessons for effective utilization of manufactured housing, readily demonstrated important advantages of manufactured housing, and showed the kinds of conditions and situations where manufactured housing can be particularly effective. These six developments were studied in depth with the aim of distilling the factors that contributed to their success, identifying the challenges they faced and documenting cost savings and other development efficiencies that were achieved through the use of manufactured housing.
Pueblo Orchard, 14 unit affordable infill rental
Napa, CA. Developed by James Jones Development
12
Section III: Types and Descriptions of Factory Built Housing
Manufactured Housing Defined: Although manufactured housing is a distinct type of factory built housing, it is often mislabeled, confused with or lumped together with several other forms of factory constructed housing. Often the terms trailer, mobile home, modular home and prefab are used interchangeably with the term manufactured home. Much of this stems from a lack of experience and corresponding unfamiliarity with the manufactured and factory built housing industry and the state and federal policies regulating construction and engineering of different forms of this type of housing.
Factory Built Housing: As a starting point, factory built housing usually is a generic term for a housing product characterized by construction of most or all of a housing unit at an industrial facility. In California and a few other states, the term refers to a specific type of factory-constructed housing that complies with state building codes. Under these codes, factory construction can entail the production of a fully completed housing unit, sections of a unit or components in the form of modules, panels or materials. Once completed at the factory, the housing unit is then shipped to a prepared site where it will then be installed or assembled upon its foundation. Typically, at least some components of the house, such as a garage, porch, or roof will be added or built at the site.
Unless factory built housing is granted either federal or state preemptions from local building codes, such housing is subject to local standards, inspections and approvals. Absent policies that provide parity with site-built housing, local jurisdictions are free to develop specialized regulations targeting factory built housing that can severely limit where and how it can be placed. Also, without state protections, private codes, covenants and restrictions may also contain provisions that significantly limit or prohibit the use of factory built housing.
Mobilehomes: Mobilehome is a somewhat generic term that refers to factory built residential housing units completed prior to the establishment of federal standards effective in 1976. Before 1976, mobilehomes were manufactured to whatever building standards – if any – that were established by state and/or local jurisdictions. Mobilehomes grew out of an evolution within the travel trailer industry in which recreational trailers were adapted and upgraded for long-term residential use. Although mobilehomes were designed for long-term residential use, they typically were not recognized as real property by state and local governments and instead treated as trailers or vehicles. Parallel lending standards evolved that relegated financing to the higher interest and unfavorable consumer terms of chattel or personal property lending. As a result, mobilehome owners were forced to obtain expensive and sometime predatory financing and had few protections as consumers.
A major consequence was that mobilehomes became stigmatized and stereotyped. The very term “mobilehome” often conjures up images of very large travel trailers or long, rectangular, flat-roofed structures with aluminum siding and little visual appeal. Because of its low cost and perceived – although not always warranted – lack of quality, mobilehomes gained a reputation as inferior and undesirable housing. This negative
13
perception was reinforced by concentrations of manufactured housing in residential communities or “parks” – even though most units are outside these communities.
Manufactured Homes: Manufactured homes, which are the focus of this guide, are residential units built in a factory to standards established by the Manufactured Housing Construction and Safety Standards Act of 1974. Commonly known as the “HUD Code”, this law authorized the U.S. Department of Housing and Urban Development (HUD) to establish and enforce a federal building code for factory built residential units that previously had been known as mobilehomes. Under this law, the term
“mobilehome” became synonymous with “manufactured housing.” Now manufactured housing had to meet strict engineering, energy efficiency, structural, and safety standards established by HUD. It should be emphasized that the HUD Code does not establish standards for architectural appeal and nonstructural quality such as interior closet doors, plumbing fixtures, floor coverings and the like. Most of the HUD Code standards are performance standards and are not prescriptive or specific as building codes are.
Once completed, manufactured homes must pass a factory inspection and have a red HUD inspection seal placed in the unit that certifies the unit meets HUD Code standards. The HUD Code also preempts almost all local building codes and thus allows manufacturers to build homes that can be installed in any state or jurisdiction in the United States. Unfortunately, absent state protections such as those in California, the HUD Code does not prevent either private deed restrictions or local land use and zoning policies that preclude or severely restrict the use of manufactured housing. The HUD Code does not regulate certain items such as fire sprinklers or ignition resistant exteriors; these can be regulated by local governments unless states develop preemptive standards.
Manufactured homes are built in the factory on a nonremovable steel chassis. Wheels are installed on the chassis that allow the unit to be towed to the site. All the major elements of the home such as exterior and interior walls, electrical wiring, HVAC, roofs, floors, plumbing, cabinetry, doors and windows are constructed or installed into a complete home. Depending on the size and number of stories, the homes may be constructed into one or more completed sections and then joined together when the house is installed on its site. The HUD Code, since 2008, also includes installation standards and minimum procedures which allow for more stringent state standards and procedures.
Modular Homes: Modular homes are constructed at a factory in multiple three dimensional boxes or modules. In California and a few other states, modular homes are called “factory-built housing”. Almost all of the exterior and interior components of the modules are completed at the factory. Once the modules are completed, they must be inspected by an authorized third-party inspector and certified to be in compliance with the appropriate state and/or local building standards. These components are then transported to the intended site of use and joined together upon a foundation.
In California, modular homes must be constructed to meet California Building Standards Code (CBSC) standards that are incorporated into Title 25, Chapter 3 of the California Codes of Regulations. Homes built to these standards are inspected by third party,
14
certified inspectors at the factory. If the unit meets state standards, an insignia will be issued and placed on the unit. Under Section 19981 of the California Health and Safety Code, housing units bearing this insignia are considered “factory-built homes” and are deemed to have met all local ordinances and regulations pertaining to housing construction. Factory-built homes are exempt from local building standards and they cannot be treated differently by local jurisdictions than other residential units of similar size. They do however have to meet the same zoning standards that apply to site-built homes in terms of setbacks, minimum lot sizes, garages, etc., and must meet the local jurisdiction?s foundation requirements which are inspected by a local inspector.
Panelized Homes: Panelized house production consists of factory construction of all of the wall or “panel” sections of a home at a factory instead of building them onsite. The degree of completion of the panels and their size is flexible. Panels are large wall sections that are partially or fully completed. Typically they include windows, doors, wiring, and outside sheathing. However, panel sections can be produced as turn-key with all components, exterior siding and interior drywall and finishes completed. Once the panels are inspected at the factory, they are trucked to the site and assembled. Using the panels as the structural foundation of the house, additional finishes and components such as the roof are added onsite. Like modular or factory-built housing, panelized homes must meet applicable state or local building codes.
Pre-Cut Homes: Pre-cut homes are essentially kit homes. All of the building materials, such as lumber, are assembled at the factory and cut to specifications. Once completed, they are assembled into a „kit? and shipped to the home site for assembly. They are subject to the same building code requirements as panelized homes.
Market-rate infill developed by Winslow-Edwards, Inc.,
15Section IV: Production and Development of Manufactured Housing
Manufactured Housing Production: Manufactured housing is constructed in factories certified by HUD as capable of producing homes that meet HUD Code standards. This requires demonstrating that a factory quality assurance program is in place and an approved set of plans, called structural approvals, for the home models the manufacturer wishes to construct have been completed. These structural approvals also serve the same function as the local government plan check for site-built housing. Finally, the manufacturer must contract with a HUD-approved third-party entity to inspect and certify completed units.
Factories that produce manufactured housing range in size from 30,000 to 250,000 square feet and employ from 100 to 450 workers. Large factories can easily turn out 30 to 50 standard to large homes a week with smaller factories produced 10 to 15 homes weekly.
Houses are built as fully completed sections, known as floors. The home is generally made up of one to four floors. Each section or floor is constructed on a steel undercarriage or frame to provide structural and transportation support. Construction occurs on assembly lines that are organized around the construction of major components and systems of the units. Large-scale industrial tools and machinery enable factories to work with large, one-dimensional unit components such as roofs, walls and floors at one time. Tolerances are quite tight and construction accordingly must be quite precise to keep the assembly line moving. This is in contrast to site-built construction where house components such as floors or walls must be broken down into components small enough to be manhandled and installed largely by human labor and hand tools.
Manufactured Housing Procurement: A manufactured housing project begins when a developer sets out to procure a unit. Ideally, the procurement process is informed by a clear project concept for a site that has been determined suitable for manufactured housing. Presumably, some type of feasibility analysis has been conducted that not only has assessed financial feasibility but also evaluated different housing types such as manufactured, site-built or modular. This process should have yielded specifications in terms of affordability levels for prospective buyers, house sizes, basic design, desired amenities and architectural standards. Armed with a clear project goal and requirements for the housing units, the developer then is in a position to begin the procurement process. The manufactured housing industry has two main procurement systems.
16
Dealer or Retail Procurement: Most manufactured homes are sold on a retail basis through local and regional independent retail dealers. Dealers purchase or order manufactured homes from factories and then sell them to individual consumers. Typically, dealers also provide transport of the units and installation services as part of the sale. Often dealers arrange for chattel or property financing at rates and terms much less favorable to borrowers than home mortgages. Increasingly though, consumers and lenders, are treating manufactured homes as real property if they are installed on permanent foundations and financing purchases through traditional real estate mortgages.
If a developer procures units through a dealer, it essentially will be making a retail purchase. Depending on the number of units, the developer might be able to negotiate some volume discount as dealers receive financial incentives from factories for their sales volume. But whatever the ultimate price, it will include a dealer mark-up or profit. The developer also will have to select from the models available through the dealer and whatever upgrades or options the factory offers.
For very small unit projects, purchasing from a reputable dealer offers some definite advantages. The dealer can often provide a one-stop purchase by providing the unit, transport from the factory and installation services. For larger project, the mark-up or dealer profit may negate the cost advantage of using manufactured housing. Also, if the sale is through a dealer, and there are construction defects, both the dealer and manufacturer are jointly responsible for remediation under California law.
Factory Direct Procurement: The other distribution system is a direct sale by the manufacturer to the developer. Increasingly manufacturers are investing in this market sector by creating model lines specifically designed for developer projects, dedicating sales and support staff and increasing marketing to developers. The developer and manufacturer will have to negotiate the following areas:
? Final specifications of units
? Purchase price of units and delivery dates
? Payment terms and invoicing systems
? Shipping and installation
? Additional quality control measures
Dealer License: In California, factory direct purchasing requires that the developer obtain a manufactured housing dealer license from the California Department of Housing and Community Development Department (HCD) unless the sale is to a general contractor with 5 or more homes sold each year, the homes are for a specific subdivision and are delivered directly to the site for installation on a permanent foundation. Government entities such as a redevelopment agency or housing authority are not required to have a dealers license for factory direct purchases.
Purchase and Specifications: Factory direct purchases are negotiated between the developer and the manufacturer in terms of price, specifications and delivery date. Developers either purchase unmodified manufactured models or require some
17
customization of the units to meet project needs. If units are customized, it will usually require collaboration between the developer and manufacturer to arrive at a redesign. Whether the purchase is for customized units or a standard model line, it is imperative that specifications for dimensions, components, standards, systems, materials, finishes and amenities are spelled out in great detail using terminology that both the developer and manufacturer understand and agree upon.
Shipping and Installation: Dealers, rather than factories, typically contract with a transporter to ship the units to the site as part of the sales price. The developer, however, must arrange their own site preparation, foundation and installation services - although the factory may be able to recommend contractors who are experienced with their products.
Payments: Factory procurement systems customarily work through invoicing for delivery of a specified number of units that meet certain specifications by a specific date with complete payment made at the end of the production run. This is very different from site-built construction contracts that provided for a series of phased payments or draws that correspond to construction progress. Construction contracts include a substantial retention for each draw to protect the developer and construction lender from general contractor nonperformance and ensure that the project is completely finished before the general contractor receives its entire payment.
Factory invoicing, by contrast requires the developer make a substantial payment in order to commence production with the balance due to be paid when the units are completed and ready for shipping. It should be noted, however, that as manufacturers work with more market and affordable housing developers, they are becoming more flexible regarding invoice, payment and even retention terms in order to accommodate developer and project needs.
Quality Control: Especially on customized projects, the developer may negotiate additional quality control measures besides those of the factories. These may include measures such as building a prototype unit before commencing a production run, developer inspections during production, and inspection of units prior to shipping. Enhanced quality control can be both worth its weight in gold and also add to production costs. As a rule of thumb, the more customization deviates from a manufacturer?s model and entails structural changes, the more likely enhanced quality control will be cost effective.
Shipping: Typically the shipping is included as part of the purchase price whether procurement is done through a retail dealer or directly from a factory. Once a manufactured unit is completed, a specialized transport company will transport the unit, using the wheels attached to steel undercarriage, to a prepared site. Thanks to HUD Code standards, manufactured homes are engineered to be structurally very durable and are able to handle the strain of being transported several hundred miles to their ultimate destination.
18
Installation: Installation entails transporting manufactured housing sections to a prepared site, successfully installing the sections onto a prepared site and completing additional onsite enhancements or additions to the unit(s). Successful installation requires the following conditions to be present:
? Suitable site has been selected
? Site has been prepared for a manufactured housing installation
? An appropriate foundation has been laid to receive the unit
Evaluating Site Suitability: In many ways, site assessment for manufactured housing is no different than it is for site-built housing. Standard activities such as reviewing zoning requirements, availability of utilities, soils testing, evaluating drainage issues and environmental assessments differ little. There are however a few areas with crucially different assessment issues when using manufactured housing:
? Soil conditions
? Unit transport access: road system free of impediments
? Obstacles to the movement of house sections onto the property and foundation
Soil Conditions: The soil must be suitable for the type of foundation system to be employed and meet weight-bearing requirements. Manufactured homes are more heavily constructed than site-built, with weights of 20% to 30% higher than comparable site-built homes.
Shipping Access: The site must be accessible by a road system suitable for the transport of long (forty-foot to sixty-foot) rigid sections or “floors” that comprise the house. This means the route must be assessed for obstacles such as bridges, sharp curves, tunnels, trees and other physical impediments that could obstruct transport of the sections. Since the manufactured housing industry has developed technologies and methods of navigating many of these types of obstacles the transport assessment should be conducted by someone with experience with manufactured housing transport.
Lot Size and Dimensions: The lot must have sufficient size to maneuver the manufactured unit?s floors or sections onto the site where it can be set onto the foundation. A rough rule of thumb is that required space equals the house footprint plus sufficient staging area to temporarily park and maneuver the manufactured sections onto the foundation. If the area coverage of the foundation/unit footprint takes up most of the sites space, there must be sufficient off-site space available. Potential off-site space could include adjacent unobstructed public or private property or public streets. Whether on-site or off-site space is used, the dimensions needed for staging and maneuvering of sections and equipment during installation should be carefully established and checked.
Site Accessibility: The site must be examined to identify existing or potential physical obstacles that would prevent the installation of a manufactured home. These types of obstacles are usually readily observable and typically related to terrain, vegetation, structure or other physical objects on or adjacent to the site. Some obvious ones are trees
19
on or overhanging the site, tree stumps, telephone poles, street lamps, large boulders and existing structures. Any obstacle that can impede installation must be removed or otherwise mitigated.
Site Preparation: Prior to the arrival of the manufactured unit, the site must be prepared. The site will need to be graded and leveled with any soil remediation necessary to support the weight of the manufactured unit completed. Plumbing and utility hook-ups must correspond exactly to the location of their corresponding hook-ups in the units. Unlike site-built houses, it is very difficult to make adjustments of receptor and hook-up locations as these components already will have been constructed and integrated into the unit. Finally all structural, physical, terrain or vegetation impediments to movement of the unit onto the site must be removed or mitigated.
Foundations: The final piece in preparation of the site is the construction and installment of a foundation. The foundation consists of all the components and systems that support and anchoring a home to the ground. There are various types of manufactured housing foundations. Depending on the type installed, foundations are composed of systems of piers, jacks, straps, tie-downs and footings. Foundations may also include a weight-bearing concrete perimeter wall. Whatever the type of foundation used, it is imperative that the fit with the manufactured home is exact. Precision in the preparation of the foundation is essential in order to avoid utility and plumbing hook up problems or damage to structural elements and components of the unit such as walls, floors, doors and windows. For this reason, the installation contractor frequently also installs the foundation.
Generally, the manufactured unit will need to be placed on a foundation that will permanently attach it to the land in order for it to be treated as real property. Such a foundation must provide long-term, durable support and stability for the manufactured unit and protect it from adverse weather and wind conditions, seismic activity and water intrusion. This generally requires that the foundation be built to meet FHA guidelines and technical specifications that are published in the Permanent Foundations Guide for Manufactured Housing (PFGMH). Compliance with these guidelines and standards must be certified by a licensed professional engineer, or registered architect, who is licensed or registered in the state where the manufactured home is located. Permanent foundations may also have to meet other standards established by lenders and/or state regulations.
20
Installations: Once the site and foundation are ready, the manufactured home can be installed. Installations are best done by an experienced installation company with specialized crews and equipment. The method used depends on the type of foundation used and the size of the overall project. Work on manufactured homes in California must be done by a licensed “B” contractor or licensed “C-47” contractor.
Drive-On Method: For individual or small projects with certain types of foundations, house sections are maneuvered onto the foundation by backing or pulling them over. They are then lowered by hydraulic jacks onto the foundation.
Roll-on Method: When foundations prevent sections from being backed or pulled onto the foundation specialized equipment is used. The section is maneuvered lengthwise alongside the foundation and special equipment is used that essentially rolls the sections onto the foundation.
Crane Method: In this method, an industrial crane simply picks the unit up and lowers it onto the foundation. They must be used for two-story installations. Crane installations are expensive but are much faster than either the drive-on or roll-on methods. For large projects where costs can be spread across a number of units, this method can be quite cost-effective.
Completing the Installation: Once the section is lowered onto the foundation, the installation contractor will then level that section. For multi-section homes, the installer will join the sections together to form a complete home. Leveling is critical to make sure that weight is evenly distributed and structural components such as floors and walls don?t sag or crack. Once the unit is leveled, the installer will anchor it to the ground to protect the unit from crosswinds and shifting.
21
The remaining work, known as finish work, consists of setting up and finishing the remaining components. In this stage, the roof will be set up, any exterior siding or skirting work will be finished and the utilities will be hooked up. In the unit interior, carpets are joined, interior doors, drawers and other such „loose? items are installed and adjusted. Any transit or installation damage is repaired and the unit and job site cleaned up.
Other onsite work that may be completed at this stage is the attachment of garages, porches and architectural enhancements. Structural attachments like garages must be free standing and cannot be supported by the home even though they are attached to it. Consequently, manufactured units will come with built in tie-ins so that they home can receive the structural attachment seamlessly and without architectural impairment of the house?s appearance.
Final Approvals: Upon final completion of the installation, a careful inspection is necessary. As noted previously, the factory and/or dealer are liable for any construction defects under the standard one year warranty. However this warranty does not apply to damage caused by transportation or installation. Thus, any problems and their causes should be identified at this time and correction arranged. In addition, depending on state laws, some type of government or third-party inspection will be required, similar to the final inspection of site-built housing.
22
Posted by Bob Arabian on November 5th, 2016 11:59 PM
That manufactured housing isn?t more widely used by the affordable housing community is especially surprising given the advantages offered by this housing type and the types of development challenges affordable housing faces in rural areas. Manufactured housing promises quality units at lower costs than comparable site-built housing through mass production economies of scale. Further, by constructing the unit at a factory and then transporting a completed unit that is exempt from local building standards to a prepared site for installation offers developers the potential for significant project time savings. These inherent advantages are amplified today by manufactured housing industry advances in unit quality, architectural appeal and increased product customization. Increasingly, market rate developers have recognized the potential cost and time savings and are using manufactured housing in an ever growing number of their developments. Yet affordable housing developers have been much slower than their private sector counterparts to take advantage of the opportunities offered by manufactured housing. The California Coalition for Rural Housing (CCRH), through funding from the Corporation for Enterprise Development?s Innovation in Manufactured Homes (I?M HOME), took up this challenge. CCRH examined the experience with and perceptions of manufactured housing within the affordable housing development community through a survey of affordable housing developers, interviews with affordable housing agencies, and an examination of development experiences with manufactured housing and in-depth research of six exemplary case studies of affordable manufactured housing projects. This guide sought to achieve four aims: ? Assess the extent to which manufactured housing is being used by the affordable housing community. ? Identify the factors that inhibit or encourage the use of manufactured housing. ? Evaluate the effectiveness of manufactured housing for affordable housing applications. ? Identify “best practices” manufactured housing development methods to both encourage and guide affordable housing developers in the use of manufactured housing.

Based on the research activities and aims of this project, CCRH made the following findings: Manufactured housing can deliver substantial cost savings over comparable site-built housing from 5% to 55%. Simply put, the developers of the case studies found that manufactured housing offered significant cost savings over comparable site-built homes. Of the six developers, five reported cost savings over comparable site-built housing ranging from 20% upwards to 55%. The other developer, with a much more customized housing product for a small infill development, still reported a 5% savings, or about $500,000 for the 22-unit development. These savings primarily derive from the scale economies of mass production that allow even small projects to significantly reduce unit production costs. Essentially the developer is purchasing manufactured homes out of a larger mass production run of similar units which benefit from bulk purchasing of materials, assembly line efficiencies and production standardization. Manufactured housing development can be faster and more efficient than comparable site-built housing All six developers of the case study projects reported important development efficiencies in the form of a shorter project completion time, reduced local project review and reductions in project management staff time. Development efficiency especially benefitted from the much smaller number of contractors required to complete the project, insulation from materials price increases and less site security concerns. Manufactured housing is a versatile product capable of performing efficiently and effectively in varied and demanding development settings The case studies show that manufactured housing is a versatile product that can perform competitively in a wide range of affordable housing applications, settings and conditions. Especially important, the case studies showed manufactured housing continued to provide important cost and times over site-built housing even when it had to meet challenging design, architectural and density standards. Even for small projects where units had to be customized and architecturally enhanced, manufactured housing still retained its cost advantages, time savings and other development efficiencies. Overall, the case studies show manufactured housing was successful in the following situations: Replacement housing Scattered site High density Infill Remote rural Smart growth Time sensitive Demanding design and architectural standards Unit customization Upscale communities Customized unit design 6 Manufactured housing cost savings can be the deciding edge in making ownership and asset development possible for very low income populations Two of the case studies, the Haley Ranch and the North Shore developments, demonstrate how the cost savings advantage of manufactured housing over site-built housing provided the edge needed to realize homeownership opportunities to very lowincome populations. In both cases, site-built housing was too costly to make the projects work within tight financial constraints. By using manufactured housing, the North Shore development was able to provide homes at prices very poor farmworker households could afford. With Haley Ranch, manufactured housing savings made possible very low rents that both preserved the assets of the displaced, very poor population residents of an old trailer while simultaneously stabilizing their housing situation. This stability, in turn, allowed residents to undertake asset building activities in employment, education and savings. It also enabled the nonprofit owner to undertake home ownership programs and services that helped families eventually purchase homes. Manufactured housing is effectively ‘purpose built’ for remote rural development and can have a demonstrable advantage over site-built housing in some rural conditions Manufactured housing offers a marked advantage over site-built housing for affordable housing applications in remote rural communities. Three case studies demonstrated an advantage, based on cost and time savings that enabled manufactured housing to surmount many of the development constraints in rural locations. These challenges stem from higher development costs that result from limited infrastructure, smaller scale projects, inclement weather, topographical challenges, environmental constraints and long commuting distances for contractors and construction labor. Cost savings from factory production and the faster project completion time that results from limited local review and quick installation of a factory-delivered unit enabled manufactured housing to overcome these rural conditions more effectively than site-built housing. The manufactured housing industry can work collaboratively with affordable housing developers to produce customized, high quality and attractive projects within tight budget and time constraints The case study developers who procured units directly from the factory point to an emerging business model for affordable housing developers and the manufactured housing industry. The manufacturers in these projects were able to work within a collaborative design-build modality in which housing units have to be customized to meet a variety of project specifications, needs and constraints. These manufacturers collaborated with developers to develop project-specific processes in areas such as unit design, production scheduling, change orders, quality control and installation of the finished housing units. 7 Manufactured housing products can be both attractive and Manufactured housing products can be both attractive and durable The case studies show that manufactured housing products can be quite attractive and architecturally appealing. Further, the Haley Ranch rental development shows that the units are durable, hold up well under rental use conditions, and maintain their visual appeal after nearly twenty years of use. The operational experience is that the units are not more costly to operate than comparable site-built rental units. Unfamiliarity and lack of basic development knowledge is retarding increased use of manufactured housing by the affordable housing sector Most of the developers surveyed for this guide had not used manufactured housing and were unfamiliar with its development process. Developers expressed concerns about the quality of manufactured housing and whether the promised cost savings would actually materialize. In a few cases, prior problematic development experiences led to unfavorable evaluations of manufactured housing. Targeted informational outreach and training activities may be necessary to fill this information gap and encourage affordable housing developers to consider undertaking manufactured housing projects. Get the first project right: developer training and technical assistance The survey of developers suggests that a negative first development experience may sour a developer regarding future use of manufactured housing. Further, a negative impression of manufactured housing may spread through a state or regional affordable housing network as other developers learn of the problem project. Accordingly, manufactured housing advocates should strive to provide the informational resources, training and technical assistance that will increase the chances of a successful first project and avoid development problems that arise from developer inexperience.
Posted by Bob Arabian on November 4th, 2016 1:09 AM

Manufactured Home Foreclosures & Repossessions

If you default on your manufactured home loan, the lender may be able to retake possession of it through repossession or foreclosure.

A manufactured home is a type of housing that is delivered to a destination and once there, is normally secured to the ground or a foundation. Read on to learn more about the nature of manufactured housing and what happens if you stop making loan payments on your manufactured home.

Understanding the Difference: Mobile Home, Manufactured Home, Modular Home

Mobile home, manufactured home, and modular home are terms that are frequently used interchangeably. However, there are differences that you should be aware of.

Mobile Homes and Manufactured Homes. In 1974, Congress passed the Mobile Home Construction and Safety Standards Act (the Act), which directed the U.S. Department of Housing and Urban Development (HUD) to put forth federal construction standards for mobile homes. (Prior to the Act, mobile homes were built with little uniformity regarding construction or safety standards.)

All mobile home units constructed after the effective date of the HUD standards (June 16, 1976) must have a HUD label certifying that the home has been inspected and constructed in compliance with the Act. On October 8, 1980, Congress enacted public law 96-399, which officially changed the name of this type of home from “mobile home” to “manufactured home.” The term “manufactured home” typically means a unit that is constructed pursuant to the HUD construction and safety standards, whereas a “mobile home” refers to homes built before June 15, 1976, when the federal standards took effect.

A manufactured home is structurally complete when it leaves the factory, and is transported in one or more sections. Manufactured homes are constructed on a permanent chassis, with a tongue, axles, and wheels for transport.

Modular Homes. Modular homes, on the other hand, are constructed to the same state, local, or regional building codes as site-built homes. Sections of a modular home are transported to the building site on truck beds, where they are then connected together by local contractors.

Manufactured Homes: Personal Property or Real Property?

Initially, a manufactured home is considered personal property, like an automobile. In most states, parties convey ownership of manufactured homes by a certificate of title, with security interests noted on the title. In states that do not use a certificate of title, a security interest in a manufactured home is perfected (made) through a UCC filing.

Though a manufactured home is considered personal property to begin with, a homeowner can usually take steps to change the classification from personal property to real property.

Converting a Manufactured Home to Real Property

Many states have statutes that provide procedures for converting a manufactured home to real property, while a few states have statutes that specify whether a manufactured home is considered personal property or real estate in credit transactions. Other states have a statutory scheme that establishes criteria for taxing the home as real property and certain other states have no statute on topic.

Generally, to be classified as real property, a manufactured home must be permanently affixed to the land.

In some states, a manufactured home can be converted to real property if it is permanently affixed to leased land, while other states require that the manufactured home owner must also own the land. (Sometimes manufactured homeowners own the land on which the home is situated, but in other cases, the manufactured home may be located on rented land or on a leased space in a manufactured home park.)

Typically, the requirements for a manufactured home to become real property may include:

  • the tongue, axles, and wheels must be removed
  • tie-downs must be installed
  • the manufactured home must be intended to be permanently attached to the land
  • the homeowner must surrender the certificate of title to the appropriate revenue commission, and
  • the homeowner must take whatever steps the state requires to have the manufactured home assessed as real estate.

Manufactured homes that are not permanently affixed to the land, or where proper procedures have not been following to convert the manufactured home to real property, will remain classified as personal property.

What Happens if the Manufactured Homeowner Defaults on the Loan?

If the borrower defaults on loan payments for a manufactured home, the creditor can take the manufactured home. How the creditor does this depends on whether the home is classified as personal or real property. If the home is personal property, the creditor repossesses the home. If the property is real property, the creditor forecloses on the manufactured home.

Repossession of Manufactured Homes: Replevin and Self-Help

If the property is considered personal property, then the creditor can repossess it.

Replevin. To do this, creditors often use a judicial process called replevin. A replevin is similar to a judicial foreclosure in that a creditor files a lawsuit in court and asks the court to grant an order for repossession.

Self-help repossession. With self-help repossession, the creditor retakes possession without the use of judicial process, like when a repo agent comes and takes a car away. his process is available in most states, but it is not especially practical for manufactured homes. It would difficult, if not impossible, to take the home without breaching the peace (a requirement for self-help repossession) or taking the borrower’s other belongings, like furniture or other personal property located in the home. Moreover, a few states prohibit self-help repossession for manufactured homes.

Foreclosure of Manufactured Homes

If a manufactured home is part of the real property, then the home is treated as real estate and the lender must use state foreclosure procedures. (Learn more about foreclosure, options to avoid it, defenses to foreclosure, and more, in Nolo's Foreclosure topic area. Also, see our Summary of State Foreclosure Laws for more information about the foreclosure procedures in your state.)

Manufactured Home Fixture Filings

In states that do not use a certificate of title, the security interest in the manufactured home is usually perfected through a UCC filing. Then, the manufactured home is considered a fixture. In this case, the creditor can retake possession of the manufactured home through self-help repossession or replevin (if available in the state), or through state foreclosure law.

 

Posted by Bob Arabian on October 26th, 2016 11:31 PM
You’ve been thinking about the factory-crafted home option. You’ve done your research, and have learned their are differences between pre-HUD Code “trailer houses” and “mobile homes” vs. today’s manufactured homes and modular homes. You know that today’s factory-built homes rival or can even out-perform conventional houses in many ways, while saving you serious money. You are ready to get down to brass tacks. It’s time to get facts on financing.

he problem with a number of mainstream media reports on the topic of financing is that they really don’t understand manufactured housing, and so their reports are often flawed – hit-and-miss accurate – as a result.

For example. Perhaps you’ve heard stuff in the media that make it sound like financing a factory-built home is harder or more costly. For those who know the ropes, how accurate are those reports? Or you might read or hear news media and writers often use the words “mobile home” or “manufactured home” or “modular home” interchangeably, yet that’s flat wrong.

Modular Home Mortgages

As we’ve previously reported, modular homes are built largely indoors to state or local building codes, while manufactured homes are built to the only federally preemptive performance-based building code (to learn more about the differences between manufactured and modular homes, click here).

So financing a modular home should be the same as getting a mortgage on any conventional housing. While there are lenders that specifically advertise doing modular home loans, any informed lender should finance a modular home and have it appraised for the same mortgage terms you’d get on an on-site-built (aka “stick built”) conventional housing.

When you buy a modular home and have it financed, it’s permanently installed on the property it will be located on, and thus will be considered “real property” or real estate. Some who do factory-built home sales refer to these transactions as ‘land/home’ package deals.

“Trailers,” “Mobile Homes” and Manufactured Homes

 These three names represent three eras for factory-built houses built on frames, and each are DIFFERENT. The video at top and other articles linked at the end of this column will give more information about those differences. Briefly, there have been no mobile homes built in the U.S. since June 15, 1976.

So when you see a journalist or writer refer to a HUD Code manufactured home as “trailer house” (sic), or as a “mobile home” (sic), that report is already inaccurate and could have other errors in it too.

A home built to the federally regulated and preemptive HUD Code for manufactured homes is by definition built on or since that date in June 1976.

“Home Only” Lending – about 2 of 3 Manufactured Home Loans

Many buyers pay cash for a manufactured home. But for those who are financing, unlike conventional housing or modular homes, broadly speaking, manufactured homes have two different ways to be financed. One method is via a “land/home package,” which means it will be financed as real estate.

Manufactured homes financed and appraised as real property can quality for FHA Title II, VA, USDA and other conventional mortgage loans.

What makes manufactured homes unique in American home lending is that they can be – and often are —  financed as chattel  — also known as a personal property or “home only” loan – instead of as real property mortgage.

Those who own or purchase property for a manufactured home thus have two options,

  • to surrender the title to the home and create a “real property” (“fee simple”) mortgage transaction with a deed,
  • or finance it as a titled personal property item.

That process has some variations between states, which your lender or manufactured home retailer can provide guidance on.

The majority of the estimated 8.8 million pre-HUD Code mobile and post-code manufactured homes (MH) are located on privately owned, individual parcels of land.

But perhaps 3 million of those homes in the U.S. are located in a land-lease setting, what is commonly called a “mobile home park,” but is better known today as a manufactured home community or a land-lease community.

For those who live in parts of Chicagoland, Hawaii or other parts of the U.S., conventional housing may also be built on a land-lease. A significant part of commercial real estate buildings are on a land-lease too. Without going into those details today, we’ll simply note that there can be advantages to leasing land vs. buying it. Those advantages can include:

  • often much lower taxes,
  • saving the up-front cost of the land,
  • maintenance of property infrastructure and the services that supply the home,
  • location,
  • school districts and other possible factors.

There have been a limited number of mortgages made in land-lease manufactured home communities, but this is generally not readily available today. There is a significant debate and discussion in Washington, DC and beyond exploring expanding options for getting Fannie Mae, Freddie Mac or other mortgages for manufactured homes on land-lease, but those are not yet settled.

So for those who are thinking about buying a home on a land-lease, odds are that you’ll be getting a personal property – “chattel” or “home only” – loan.

Home-Only Loans Can Be Competitive

Other than on FHA Title I loans, which are available for home-only manufactured home loans, there are generally no federal loan guarantees.

So because a lender keeps that loan on their books, the rates on manufactured home loans will commonly be a few points higher than a conventional housing loan. But keep in mind that buyers routinely save on closing costs, appraisals or fees, and your home may be taxed at a far lower rate than real estate is.

Also, if you go long-form on your income tax, you can deduct the interest on your home loan the same as you do on a house mortgage. So when you look at the total picture, the personal property loan can be quite competitive to mortgage lending.

The key for most buyers comes down to two numbers – how much money down, and how much are the monthly payments.

Because manufactured homes are a fraction of the price, payments on manufactured homes are routinely the most affordable kind of housing payment, as the two payment charts on this page reveal.

Triad Financial Services,  CU Factory Built Lending and 21st Mortgage are the primary personal property MH finance sources here in the U.S.

While some local banks make manufactured home loans, it is more common to find that a credit union will make such loans.

While there are close to 9 million pre-HUD Code mobile homes and post-code manufactured homes in the U.S., that’s only about 7% of the 124 million households living in all other types of housing. So bankers often have limited or no experience in manufactured home lending. Bankers will often understandably shy away from what they don’t know. So if you don’t already have a good relationship with a local bank or credit union, or if they aren’t experts in manufactured home lending, often the easiest way to obtain competitive financing is to go with one of those lenders noted above.

Ignorance can be costly, and knowledge can pay! You may get a wide range of well-meaning advice from people who truly aren’t experts in manufactured housing, much less about manufactured home financing. Lenders like those linked above have toll-free numbers, and employ licensed staff that can answer questions and process applications, originate and service loans.

Big Brother Made Getting Facts and Advice Harder

Lamentable CPFB implementation of regulations has effectively gagged unlicensed retailers or communities. So even if the seller knows a lot about lending, unless they hold an MLO license, they may not be able to give you a lot of guidance beyond handing you brochures or pointing to a list names of the lenders in your area that make manufactured home loans. You can learn more about the that harmful part of the impact of Dodd-Frank and the CFPB’s regulations at the articles linked below.

Timing and the Bottom Line

All lending has been slowed since CFPB regulations went into effect. An NAR study revealed that one of the biggest surprises for any home buyer is that it takes longer than they thought to get a home loan.

So try to avoid unnecessary stress by planning ahead when you are ready to buy a home. The more time you allow for financing, the more pleasant your home buying experience will likely be. If you plan to custom order a home, you should be thinking a few months in advance. Whenever available, getting pre-approved for manufactured home financing can be a good idea when you are getting ready to go shopping for your home.  Good, reputable home retailers in your area can give you a good idea on how long the financing process can be.

Depending on your credit and down payment, comparing your options between the lenders in your market will lead you to the best terms. With typically lower monthly payments than other forms of housing, because manufactured homes are born greener and more energy saving by design, buying a manufactured or modular home can be a great choice for you, as it has been for millions of others.




Posted in:Mobile Home Articles and tagged: Financing
Posted by Bob Arabian on October 18th, 2016 10:46 AM

How to Finance a Manufactured HomeChattel mortgages, FHA loans and conventional loans are a few options you should consider.

What Is a Manufactured Home?

A manufactured home is a factory-built home which is constructed on a permanent chassis so that it can be easily moved, even though most manufactured homes are not moved from where they’re first installed.

Sometimes manufactured homes are confused with modular homes or prefab homes, but they are different things. Modular homes can be built “on-frame” — with the chassis, or “off-frame” modular, which means that the chassis is removable. Usually, modular homes are attached to private land.

Manufactured homes also differ from mobile homes because they follow a uniform construction code outlined by the U.S. Department of Housing and Urban Development Title 6 standards, also known as “HUD code.” A home that was built following this HUD code will have documentation called the Certification Label and the Data Plate. This information is important and irreplaceable as it can impact the selling, financing and insuring of the manufactured home.

Financing Options for Manufactured Homes

Mobile home financing can be tricky, but it’s not impossible. The one thing that will increase the chances of a homebuyer getting approved is owning the home site on which the mobile residence will be located. If, on the other hand, the buyer plans on living in a mobile home park and paying space rent to the owner of that land, then the chances of getting financing through a bank are reduced.

The same type of logic goes for people who want to finance a manufactured home — whether or not that home is already attached to land can make or break the approval of a loan. In both scenarios, having good credit will help your chances of getting approved for financing or a more competitive interest rate.

Conventional Loans

Although it’s not impossible to get a conventional loan for a manufactured home, it can be tougher than getting financing with a Federal Housing Administration Insured Loan. Fannie Mae and Freddie Mac lenders do make conventional loans on manufactured homes, but the specific lender you want to use must meet specific requirements.

For example, Freddie Mac requires loan originators to comply with their Single-Family Seller/Servicer Guide Chapter 5703. This guide sets out several rules including requiring a minimum down payment of 5 percent, which has to be paid for out of the borrower’s personal funds, for all purchase transactions.

Additionally, Freddie Mac requires originators to consider the added collateral risk a manufactured home poses and, in conjunction with credit reputation, capacity and collateral of the borrower, use that added risk consideration to assess the overall risk of the mortgage loan.

One advantage Freddie Mac does offer is to borrowers who own the land on which the manufactured home will be attached. This land might be used as an equity contribution.

Chattel Mortgages

The difference between borrowers who own land and those who don’t is that the manufactured home is considered “real property” in the former circumstance and, in the latter, it’s considered “personal property.”

For borrowers who are leasing the land on which the manufactured home will be located, a common option is chattel mortgage loans. The drawbacks of a chattel mortgage loan are that the interest rates are higher and the terms are usually shorter than conventional or FHA loans, so monthly payments will be higher.

Borrowers who have good credit, which by today’s standards is around a 720, might land a loan with rates in the high 6-percent range. People with lower scores might be facing higher interest rates of 10 percent or more.

If you plan on living in the home for several years or more, your best bet might be to also buy the property along with the home. Buying both the property and the home will most likely expand your interest rate options, leading to a better deal in the long term. Whatever you choose, be sure to research loan options before committing to an expensive loan or one with terms you’re not completely comfortable with.

FHA Loans

The FHA is in the business of insuring, not making, loans. By backing loans, the FHA encourages lenders to loan money to would-be homeowners. What that means is if the borrower stops making payments and ends up defaulting on the loan, the FHA would make a payment to the lender.

FHA loans fall under the Title I program which includes manufactured homes. One major benefit to these loans is that the FHA guidelines require them to be fixed throughout the full mortgage term, which is usually twenty years. Adjustable rate mortgages, therefore, would not be eligible for FHA backing.

Another important benefit, especially for people who will lease the land on which their manufactured home will be located, is that the FHA does not require the borrower to own the land. One stipulation to this is that the lessor must lease the land to the borrower for a minimum of three years in order to qualify for a loan.

The maximum loan amounts for Title I insured loans are as follows:

  • $69,678 for the manufactured home by itself
  • $23,226 for a manufactured home lot
  • $92,904 for both the manufactured home and the lot

To be approved for a Title I insured loan the applicant’s credit history is reviewed and considered, the borrower must be deemed able to make monthly payments and this must be the primary residence of the borrower.

VA Loans

Like FHA loans, Veterans Affairs loan guarantees offered by the Department of Veterans Affairs are insurance for lenders in case the borrower defaults on the loans. Manufactured homes — both with owned and leased lots — might get VA loan guarantees, however, the amount the VA will cover differs for each setup.

For manufactured homes that will not be put on a permanent foundation, borrowers can get a loan for up to 95 percent of the home’s purchase price. VA will guarantee 40 percent of the manufactured home loan amount or the veteran’s available entitlement, up to a maximum amount of $20,000.

Eligible parties — service members, veterans, spouses, and other eligible beneficiaries who are eligible for a VA loan — must present a certificate of eligibility or COE to qualify for VA-guaranteed manufactured home loans and they must reside in the home.

These COE requirements vary, but include specifications like minimum active duty service requirements and marriage status, in the case of an eligible spouse. Along with a COE, the borrower must also meet other requirements including a good credit rating and enough income to make the monthly mortgage payments.

Posted in:Mobile Home Articles and tagged: Financing
Posted by Bob Arabian on October 18th, 2016 10:40 AM
Construction loans are combined with either an FHA or conventional loan (permanent loan). The construction loan terms are in place during the construction period (usually 4-6 months), and then changed to the terms of the FHA or conventional loan once the construction is done, construction lenders will either do a one or a two time close. A onetime close, as the term suggests, requires only one closing, and when the construction is completed, the terms are modified to the permanent loan. A two time close requires closings on both the construction loan and the permanent loan, which can result in higher closing costs due to multiple closings. The proceeds of the construction loan are paid out in draws to the contractor/builder (progress draws) as the project progresses. Lenders will usually require the borrower to pay interest only payment on whatever draws the contractor/builder has taken.
 
Manufactured Home Mortgage offers construction loans for as little as 3.5% down. Additionally, if you own your lot already, you can use the equity in the property for down payment. The permanent loan can be either an FHA or conventional loan. All of our construction loans are one time close loans. We offer construction financing for Manufactured, Modular, or site built homes. The interest rate on your permanent loan is locked at the time you close your construction loan, so you do not have to worry about interest rates increasing while your home is being built.

Call Lou Schmidt at 916-861-2292 for more information about our Construction Loans!
Posted by Bob Arabian on October 16th, 2016 10:33 AM

FHA modular and manufactured home loans represent a popular option for home buyers who currently have the ability to repay a mortgage, but may have had some credit challenges in the past.  FHA loan products also carry lower down payment requirements. These products are a great vehicle to help individuals who have a not-so-perfect financial history achieve the dream of home ownership.

Qualifying for a FHA Modular or Manufactured Home Loan

FHA modular and manufactured home loans are made by private lenders but are insured by the FHA in the case of default. In many cases, these loans have lower credit score requirements than conventional loan products.  So don’t assume that past credit challenges, or no established credit, will automatically deter you from obtaining a home loan.  Contact MHM today and let us make that determination.

To qualify for a FHA modular or manufactured home loan, you must make a small down payment. MHM FHA modular and manufactured home loans require as little as 3.5% down or land equity in lieu of this amount.

As with any loan, you must prove you have enough income to afford the payments.  The debt to income ratio required for approval can vary based on a number of factors including past credit history, how much of the total income is dedicated to housing, residual income calculations, and other factors.  As part of the loan application process, a representative at MHM can help you understand debt to income ratios and work with you to determine the appropriate loan amount for your unique circumstances.

Rules for FHA Manufactured Home Loans

Because FHA manufactured home loans are insured by the FHA, there are certain rules and requirements that must be met. These include but are not limited to:

  • The home must be built after June 15, 1976.
  • The red HUD label must be affixed to each section.
  • Minimum size to be financed is 400 square feet.
  • The home must be permanently affixed to a foundation that meets FHA standards.
  • The home must meet the Model Manufactured Home Installation Standards.
  • The lot where the manufactured home will be set must be designated or approved.
  • The home must be used as a primary residence.

While there are many rules for FHA modular and manufactured home loans, MHM is an expert in making sure homes are FHA compliant. We understand every case is different, and throughout our history of offering FHA modular and manufactured home loans, we have worked with all sorts of borrowers. 

We have dedicated loan officers who are experts in their field and want to help you qualify for the modular or manufactured home loan you need. Our goal is to help you achieve your dream of home ownership so we offer a range of extra benefits including rock bottom interest rates, 30 year loan terms to make payments smaller, and a qualified pool of appraisers that will appraise your home fairly. When you choose MHM for your FHA modular or manufactured home loan, you can expect the highest level of service from the first day you contact us all the way through closing and for as long as you have a loan with us. Get started on your modular or manufactured home loan by calling 916-861-2292 or completing an online application today!

Posted by Bob Arabian on October 16th, 2016 10:19 AM

Manufactured Home Mortgage offers a range of manufactured and modular home financing options to meet the needs of all types of home buyers. This includes conventional loans for top qualifying applicants as well as a wide range of other loan programs which include opportunities for prospective buyers who can afford a home today, but have had some credit challenges in the past. The following information will provide details about our modular and manufactured home financing options so you can find the best financing for you.

FHA Loans

FHA loans are insured by the FHA and best suited for borrowers who don’t have a large down payment and that have less than perfect credit. Through our FHA loan programs, we can often qualify individuals who have had past credit challenges.  We also can often assist buyers with higher debt to income ratios who have other strong compensating factors to help justify their ability to apply a higher percentage of their monthly income toward their housing payment.  To be eligible for FHA financing, the manufactured home you are purchasing must have been built after June 15, 1976 and be permanently fixed to a foundation.  If you are purchasing an existing manufactured home that is not currently affixed to a foundation, we may be able to structure a loan for you that will allow the foundation to be upgraded to FHA standards.  Some of the perks of this program include a low 3.5% down payment, 30 year loan terms, and low interest rates. Learn more about our FHA loans for modular and manufactured homes.

VA Loans

We have special VA loans for veterans in need of financing for manufactured and modular homes. While many manufactured home financing companies do not offer VA loans, MHM offers these loans to qualifying veterans with a credit score of 620 or higher. Our VA loans can cover 100% of the loan cost, meaning $0 down payment. Most VA manufactured and modular home loans require a VA funding fee that can be financed; however, all VA loans we offer are exempt from monthly mortgage insurance fees. Learn more about our VA loans for modular and manufactures homes.

Conventional Loans

MHM is one of only a few manufactured home financing companies that offers conventional loans for manufactured and modular homes with terms that are similar to site-built home mortgages.  At MHM, these loans do require a debt to income ratio below 43% and credit score of 680 or more. The maximum loan limit is currently $417,000; no upfront or monthly mortgage insurance premiums apply on loan to values of 80% or less; and unlike the other manufactured home financing options, conventional loans can be used for second homes.  Conventional homes can also be used to finance modular homes as investment properties.  Learn more about ourconventional loans for modular and manufactured homes.

The MHM Difference

When it comes to financing manufactured homes, MHM is one of the top rated manufactured home financing companies in the country. We have a long history of customer satisfaction and offer financing for manufactured and modular homes in California.

Although MHM is an industry leader in financing manufactured homes, it is not just our knowledge and great loan programs that make us the top choice for manufactured home financing. We deliver personalized service to each and every one of our loan applicants that far exceeds other manufactured home financing companies. We understand that every situation is different, so we take the time to understand your circumstances and craft the right loan for your situation. We are also friendly, understanding, and eager to help. We will go out of our way to answer your questions about manufactured home financing while promptly answering your emails and calls to explain the loan process and put your mind at ease.

We are confident we have the right manufactured home financing option for you. It all begins either with a simple call to us at 916-861-2292 or by completing an online application so we can determine your eligibility and match you with the perfect modular or manufactured home loan for your situation. Contact us today, and take a big step forward on the path to home ownership!

Posted by Bob Arabian on October 16th, 2016 10:14 AM

Can I Get a Loan for a Mobile Home?

Trying to get a loan for a mobile home? You may be surprised to learn there are financing options available for non-single-family residence houses. Here’s what you need to know.

The Different Types of Mobile Homes

Your property type holds all the cards when it comes to whether or not you’ll be able to obtain competitive loan terms. (Your financing will also depend on your credit score, with good ones qualifying you for better rates. You can see where you credit stands by viewing your two free credit scores each month on Credit.com.) For starters, you need to own the land. If you own the structure, but you don’t own the land, your options become very limited andpricey.

The classic scenario is you own a unit in a mobile home park where one entity owns land and all of the people who reside in the complex pay a housing obligation called “space rent.” Bank lenders consider this scenario to be a more risky type of lending. And most will not dabble in it, though there are a few exceptions.

Other financing scenarios in this space include the purchase of manufactured homes or modular/prefabricated homes.

Manufactured homes are bought at a dealership and moved on a flatbed truck to the final destination and affixed to the earth with a permanent foundation. The key here is that the property was already built in its entirety someplace else, then simply moved and subsequently attached.

Another unique way to identify a manufactured home is by its 433A form — this is a form filed with the county signifying the property is on a permanent foundation. These properties also have HUD tags, further supporting that the property is indeed, manufactured.

If you are looking for financing for this property type, you should know that your options will be limited when the manufactured home is not yet attached to earth. The lender is much more likely to finance the properties already attached to the land — meaning the dwelling and land transfers in the sale when buying the home.

Fannie Mae and Freddie Mac do make conventional loans on manufactured homes — if you can find a lender who will do so. More lenders will finance this type of property with a Federal Housing Administration Insured Loan, as the FHA is much more forgiving in their underwriting standards and the lender has far less buy-back risk (a situation where a new loan goes bad and the originating lender is forced to buy back the bad loan for a steep loss). FHA loans pack in more insurance against lending risk, making the FHA a far more likely financing vehicle for manufactured home transactions. Here are four unique FHA Manufactured Home Requirements:

  • The property cannot be in a flood zone.
  • The home structure cannot have been previously moved.
  • The structure must have been built after 1976.
  • Mortgage insurance and impound account for taxes and insurance applies (no matter what down payment).
If You’re Looking to Buy a Modular or Prefabricated Home

Modular homes are built on site at the property with a permanent foundation. These homes do not have HUD tags — or the strong lending restrictions, generally, that apply to manufactured homes. Financing options for modular homes are similar to single-family home options.

If you are looking purchase one of these unique property types, make sure you arepre-approved upfront and provide your lender all of the details. The tiny details left undisclosed are the ones that cause home transactions to go awry.

Do not assume a unique property type that is anything other than single-family 1-4 unit home is automatically going to be a slam-dunk. Not sure if your property type is unique? It is always a best practice to bring any and all pertinent information to your lender and real estate agent as early on in the process as possible.

Posted in:Mobile Home Lender and tagged: Loans
Posted by Bob Arabian on October 16th, 2016 9:53 AM

Licensed Loan Officers - Manufactured Home Mortgage (Southern California)

Yes, We are Direct with 21st Mortgage. You do not need to go use another broker for 21st Mortgage loans if you work with manufactured home mortgage. 

We will offer you the highest payout and your customers will receive 100% Better service. 


Candidate will be responsible for origination of mainly Mobile Home Loans In Parks, Manufactured home loans on Land as well as construction to permanent. Conducts initial pre-qualification interviews and prepares complete loan application packages and necessary documentation. Conveys policies for extension of credit in accordance with lender and or investor guidelines. 

Loan Officer Job Duties:

Evaluates loan applications and documentation by confirming credit worthiness.
Improves loan applications and documentation by informing applicant of additional requirements.
Rejects loans by explaining deficiencies to applicants.
Approves loans by issuing checks or forwarding applications to loan committee.
Completes loan contracts by explaining provisions to applicant. 
Obtaining signatures and notarization; collecting fees.

Helps customers by answering questions; responding to requests.
Maintains customer confidence by keeping loan information confidential.
Updates job knowledge by participating in educational opportunities; reading professional publications; maintaining personal networks; participating in professional organizations.
Accomplishes bank mission by completing related results as needed.

Required Skills:

  • Minimum of one to two years of experience working in Home Loan Origination
  •  Understanding of details and guidelines of all available home loan programs
  • Experience developing contacts with local realtors, dealers, park owner and developers.
  • Experience advising applicants of options available to them for financing, explaining the differences between various mortgage products and negotiating terms and conditions of the loan
  • Must have excellent customer service skills
  • Good typing and computer keyboard skills
  • Knowledge of Microsoft Word, Excel, and Outlook
  • Ability to maintain positive working relationship with Members and other team members
  • Ability to exhibit composure, patience and poise when dealing with difficult situations involving Members and/or co-workers
Work Schedule & Pay:

This is a full-time, commissioned position which will involve weekend and evening hours when necessary. Position will be Home-Based with possibility of a draw.  100% Commission Based but will provide some leads. Southern California is an open market ... Great Opportunity to be part of a growing company.

Call 707 - 225 - 1864 Ask For Rob La Monica or send resumes to robmhmloans@yahoo.com
Posted in:Job Openings and tagged: Job Openings
Posted by Bob Arabian on October 15th, 2016 8:11 PM