How to Find Mobile Home Lenders
This seems like a contradiction, but it should make Manufactured Home loans a logical consideration among the possible lenders that are looking to emerge into a lucrative new niche market. Which leaves everyone in the Mobile Home community asking the question: Who will step up to the plate to be the leading Mobile Home Lender? It is possible that Warren Buffet will step up to the plate, but his big investments and movements lately have seemed incongruous. He may move to a low-stakes table, while the Manufactured Home financing market is overtaken by a new investment company willing to emerge into a new market starving for capital.
Lending standards in the Manufactured Home finance market have typically become restricted throughout periods of economic hardship. This is expected, but still unwelcome. The tight standards that lending institutions are now maintaining for Manufactured Home loans can be compared to a agriculturist who drains all the nutrients from his dirt as quickly as possible. The farmer then blames at the grocer for his losses, instead of realizing that he himself is truly responsible for poisoning the well. The banks have been taking advantage of the relaxed laws for nearly half a decade, while profiting from allowing irresponsible lending to occur, then securitizing the loan and selling it off. Now the hens have come home to roost, and the banks are acting irresponsibly in the opposite direction, on the side of over caution. Manufactured Home lending institutions are using any excuse to reject completely sound loans.
Mobile Home finance California agents are now in the position of not knowing who the new primary lender will be in the Manufactured Home finance industry after the dust settles. In recent news the fed has banned Taylor, Bean and Whitaker from providing any future loans backed by by the federal government. HUD believes Taylor failed to submit a necessary financial report, which amounted to fraud concerns. Taylor was also ordered to cease in issuing MBS for Ginnie Mae. This firm was the former premier source of funds for manufactured homes, they lent nearly $1.45 billion of all Manufactured Home investments in 2007, which were insured by the Federal Housing Administration.
Wells Fargo, JP Morgan Chase Bank, and Countrywide are the remaining large mobile housing lenders, but these companies aren’t as active as they used to be in the Mobile Home loan market. This small amount of lenders will likely lead to downsized competition, yieldning a high demand and therefore, higher interest rates passed on to the consumer. In this scenario, the lenders have the upper hand and will probably only issue a limited number of loan programs available to refinance or finance a Mobile Home in America.
Mobile Homes have been the first step towards homeownership for lowincome and retired Americans for quite awhile. Mobile Home loan brokers are discovering it more and more challenging to find new sources of mobile home funding from a group of lenders that has shrunk during the past several years. Manufactured houses, which are factory-built in parts and then put together at a land site, are significantly less expensive than traditional homes. According to the Commerce Department, the average price for a Mobile Home in 2008 was $65K, much lower than the average price of $292K for a site-built home.
Strangely, Warren Buffet’s Berkshire Hathaway revealed recently that in this current housing/banking crisis, their Mobile Home customers are foreclosing less and making their loan payments more. Berkshire subsidiary Clayton Homes’ delinquency rates for mobile home loans have also been stable during these times of turmoil: the delinquency rate was 3.26% in 2004; it was at 3.5% in 2008; and now it’s 3.82% here in 2009. However, the delinquency rate in the traditional housing market is higher, around 6.4%. Annual credit losses are running steady at a reasonable 1.5% of the loan portfolio. It is worth mentioning, however, that Clayton does not securitize their loans. This means the loans remain on their books, so they are much more conservative in their loan approval process.
While searching for a California mobile home loan, there is a determining decision to make before even beginning to consider your options. You need to decide whether you will be looking for a loan with a fixed, adjustable or variable interest rate. In order to determine, you need to know the differences between these types of interest, and know the pros and cons of the two mortgage types.
California’s Proposition 60 offers tax relief by preventing property reassessment when a senior citizen (55 +) sells their current home and buys a new home worth the same or less. One problem with Prop. 60 is that the tax relief is nullified if a senior buys a home in another county. However, with Prop. 90 a senior citizen will enjoy the tax relief even if their new home is in another county, as long as they move to a participating county.
Penn State University carried out a mail survey in 12 rural Pennsylvania counties, the findings showed that mobile home residents were “overwhelmingly satisfied” with their housing choice. The survey elicited 385 responses. The results showed 48 percent of the respondents cited affordability as a benefit. Another 47 percent said the interior layout of the mobile unit contributed to their satisfaction.
