“CHOICEHome is our innovative, affordable mortgage initiative, offering financing for a real-property factory-built home that’s built to HUD code but with many features of a site-built home,” said Freddie Mac in describing their lending initiative on a specific types of HUD Code manufactured homes.
“When a factory-built home meets certain specifications, it’s granted CHOICEHome certification and is eligible for CHOICEHome financing. That means you can use the same underwriting parameters you use for site-built homes,” the same Freddie Mac document states.
The graphic above provides a snapshot of some of the standards that ChoiceHome has established in collaboration with specific Manufactured Housing Institute (MHI) member companies, which sources say were developed and agreed to in closed door sessions. The minutes of those meetings have not been released by either of the Government Sponsored Enterprises (GSEs or “Enterprises”) of Freddie Mac or Fannie Mae, despite repeated requests. That begs the question, why the lack of transparency?
As a point of principle, MHProNews has no problem with HUD Code manufactured home builders designing any kind of housing they wish that meets federal standards, is honestly marketed, sold, and ethically serves customers.
The concern is rather that a special lending program has been designed for a specific kind of HUD Code home that is contrary to the stated purpose of the law.
FHFA’s website says: “The Duty to Serve (DTS) requires Fannie Mae and Freddie Mac (Enterprises) to facilitate a secondary market for mortgages on housing for very low-, low-, and moderate-income families in: Manufactured housing…”
The new “CrossModTM homes” – previously referred to as ‘a new class of homes’ – by the powers that be that dominate MHI in and of itself may be legally acceptable. The legal and moral concern is when the expressed purpose of the Housing and Economic Recovery Act (HERA) of 2008 Duty to Serve (DTS) manufactured housing is ducked, dodged, deflected and essentially thwarted from the clearly stated purpose noted by FHFA above.
Reality Check
Let’s note that HUD Code manufactured homes have had higher roof pitches and other features for over a decade.
There will be two more upcoming articles planned on this topic as a lead-up to the Washington, D.C. FHFA listening session. The facts and evidence will be stated, laid out, and linked up.
The questions should be asked and answered.
- Has FHFA allowed the Enterprises to ignore the clear intent of the law?
- If so, what will FHFA, lawmakers with Congressional oversight, and other public officials do to correct it?
See the related reports, above and below the byline and notices for more. The full Freddie Mac brochure from which the above quotes and images originated are linked here as a download.
As lovers of history, we’d bet that Cicero would have recognized these folks for what they are. Smiling yet treacherous ‘friends’ to manufactured housing.
That’s your installment of manufactured home “Industry News, Tips, and Views Pros Can Use,” © your runaway #1, biggest and most-read professional information resource, where “We Provide, You Decide.” © (News, fact-checks, analysis, and commentary.)
Soheyla is a co-founder and managing member of LifeStyle Factory Homes, LLC, the parent company to MHProNews, and MHLivingNews.com. Connect with us on LinkedIn here and here.
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