That risk to lenders in turn harms some four million people, representing about 1.7 million households living in manufactured homes nationally. Tens of thousands of those dwell in Florida, where 10.4 percent of all single-family housing in the state is manufactured homes or pre-HUD Code mobile homes, according to Statemaster.
The mortgage crisis in 2008 that dumped thousands of conventionally-mortgaged homes into foreclosure resulted in regulations that do a tremendous disservice to people who are interested in buying or selling a manufactured home that is valued at $20,000 or less: because of federal regulations it is too risky to make those loans. A lending expert reminds the Daily Business News that the impact is not limited to that ‘under $20,000’ price-point. The Vazquez comemnt shown also made that same assertion.
As tbo OpEd states, “A 2014 Government Accounting Office report shows that a mobile home is the least expensive form of permanent housing on a monthly cost basis. This is so even though mobile home or personal property loans are at a higher rate than conventional mortgages. This isn’t because of greedy so-called ‘predatory lending,’ as some wrongfully allege. The lender making the loans carries it on its own books, unlike some 90 percent of mortgages on other housing that enjoy some form of government backstop or has access to the secondary financial markets.” It should be noted that the original version of the OpEd submitted used the terms MH or manufactured home, where tbo published the phrase ‘mobile home.’
If lending on manufactured home loans was so profitable, lenders would be fighting to get into the market to make those loans, but instead they are leaving the market because the Consumer Financial Protection Bureau (CFPB) will not alter their guidelines to allow loans under $20,000 to be practical. Thus, consumer protection has become consumer interference, preventing thousands of renters from becoming homeowners.
The article concludes: “The U.S. House passed the bipartisan Preserving Access to Manufactured Housing Act (H.R. 650) by a wide margin. Sen. Marco Rubio is a co-sponsor of S. 682, the companion bill that will come up for a vote as part of a legislative package in the Senate in a few weeks. Please call Sen. Bill Nelson’s office and ask him to support S. 682.”
In responding to the article, Maria Vazquez said in part that: Community banks are closing at record rates. Dodd-Frank needs to be reformed. We need to see changes to the CFPB regs before we see a further crumbling of the local banking system.”
The original article repeatedly refers to “mobile homes,” which has been changed to manufactured homes by their editor, but it elicited this response from Victor Frost: Kovach… “would never use the phrase ‘mobile home’ unless he was explicitly referring to those homes made previously to June 15,1976, and even then most of the time he refers to them as Pre-HUD homes or Pre-HUD manufactured homes. The “mobile home” died in 1976. If you see MH being used by Tony Kovach, it should always be read as manufactured home. It is becoming blatantly obvious that CFPB regs need to be changed.”
For the full tbo OpEd, please click here, and please post your comments on the need to reform Dodd-Frank and CFPB regulations on MH lending. The comments section is near the bottom of the page. A sample comment is shown above. ##
(Photo credit: MHvillage–Lake Village manufactured home community, Nokomis, Florida. Credit Maria Vazquez comment, TBO.)
