IMHA Executive Director Mark Bowersox attended the Manufactured Housing Institute’s (MHI) annual meeting held September 28 – October 1 in Carlsbad, CA. As with most recent industry meetings, speakers and conversations at the event were focused on the impact of the Dodd-Frank consumer protection legislation and reforming the CFPB’s upcoming regulations. MHI and other industry representatives continue to work with the CFBP on three key areas:
Exemption for manufactured housing appraisal requirements
Based on the most recent rules issued by the CFPB loans on all new manufactured homes, regardless of whether or not they included land, are exempt from the appraisal requirement. Loans on existing manufactured homes, not including land, are also exempt from the appraisal requirements. Additionally, all mobile homes (pre-HUD code) home loans are exempt. The CFPB’s rule solidifying these exemptions is still pending. When finalized the rule will go into effect in January.
Key rule clarifications and exclusions
Loan originator compensation guidelines issued by the CFPB this summer provide the industry with key exclusions from the points and fees calculation that lenders must perform and clarifies certain activities that retail sales staff can engage in without being defined as loan originators.
Manufactured home sales price is excluded from the points and fees definition and does not have to be included in calculations performed by lenders unless a creditor has knowledge that the sales price includes compensation for loan origination activities.
Retail sales commissions paid to employees is excluded from points and fees calculation requirements unless the salesperson is receiving compensation from a lender for loan origination activities.
According to MHI, activities that do not classify a retailer or its sales personnel as loan originators include:
Providing or making available general information about creditors and loan originators that may offer financing for manufactured housing
Gathering or collecting supporting information or documentation on behalf of a consumer for inclusion in a credit application
Providing general credit application instructions so that a consumer can complete it themselves
Financing the sale of no more than three homes in a year.
Activities that will make a retail employee be considered a loan originator include:
Filling out a credit application for a customer
Discussing particular credit terms with a customer
Directing or influencing a customer to select a particular lender or creditor
MHI continues to seek from the CFPB to provide further clarification on what activities retailers can engage in without being defined as loan originators.
MHI is still working with the CFPB and various consumer interest groups on the need to revise the upcoming High Cost Mortgage Loan triggers for manufactured home loans. IMHA will continue to be engaged on this issue, along with MHI and other interested parties. ##
Indiana Manufactured Housing Association
Recreation Vehicle Indiana Council
3210 Rand Road
Indianapolis, IN 46241
(Editor's Note: You can find more info on the LO Comp Rule and HOEPA from DJ Pendelton's article published in the Industry In Focus Reports module, linked here.
You can also find Mark Bowersox's “It's Now or Never” featured article, linked here. )