Recently, the U.S. House Financial Services Committee acted on and passed the Preserving Access to Manufactured Housing Act (H.R. 1779). This bill would amend the loan amount thresholds under Dodd-Frank that set criteria for manufactured home loans classifying them as “high-cost.” Under current Consumer Financial Protection Bureau (CFPB)
guidelines, many small loan amounts originated for manufactured home purchase are unjustly classified as predatory and high-cost.
Due to increased potential lender liabilities for generating “high-cost” loans, lenders have balked at continuing to offer these loans thus denying, in some cases entirely, access to financing for moderate and low income housing consumers.
This bill, by changing elements of “high cost” mortgage criteria, can help derail this negative trend and stimulate lending. This could broaden consumer access to loans originated for manufactured home purchase, sale or refinance.
This is a positive development in “kick starting” what could become a robust manufactured home financing market.
This bill also clarifies that under Dodd-Frank manufactured home retailers and salespersons would not be considered loan originators unless they receive compensation from a lender, mortgage broker or loan originator. This change thus eases anxiety over being unjustly “flagged” for potential CFPB fines and penalties which is another positive development in reviving the manufactured home financing market. ##
(Editor’s Note: The Manufactured Housing Institute has asked manufactured home owners, MHIndustry professionals and others who care about financing for quality affordable homes to contact their congressman to support HR 1779. They’ve made it easy! You’re just a few clicks away from sending a message, start by clicking the link below.
Or to get a more in depth look on the growing bi-partisan support for HR 1779 and MH financing, click here).
Robert G. Williamson, Jr. – JD – is a partner with Hart King Law. He represents manufactured home community owners and managers with their various legal issues including FHA and HOPA compliance issues. He may be reached at firstname.lastname@example.org or at 714.432.8700.
(MH Photo Credit: WikiMediaCommons)