The manufactured housing industry has been confronted with the most serious challenge to its existence in its history in the form of the Dodd-Frank bill. Supporters of the bill failed to take into consideration that, as written, the Dodd Frank bill effectively eliminates chattel (home-only) financing for loans under approximately $78,000. The bill essentially lumps chattel lending criteria in with the same real estate lending restrictions, thus ignoring the higher cost of funds for home-only loans. As the loan amount declines, and the higher cost of funds plus the fixed costs of making a loan effectively kick home-only loans into the predatory lending category once the loan amount hits some $78,000.
H.R. 3849 is a proposed bill that has been introduced into the House of Representatives by Indiana's Congressman Joe Donnelly and Tennessee's Congressman Stephen Fincher. The bill is aptly titled the Preserving Access to Manufactured Housing Act. In addition to limiting the impact on manufactured chattel loans from the restrictions described above that were introduced by the Dodd-Frank bill, the proposed H.R. 3849 would exempt manufactured housing salespeople that are not deriving income from the proposed financing the salesperson is trying to arrange.
Oklahoma was the second state after Mississippi to have its entire congressional delegation signed on as co-sponsors of HR 3849. I was able to help secure the backing of Oklahoma's congressional delegation through meetings with either each of our congressmen, or with their staff member with responsibility for housing issues. The following points were helpful in securing their support:
Manufactured housing is not only the most affordable housing available in the United States, our production capabilities are the most efficient in the world for the production of entry level housing.
The manufactured housing industry although monitored by HUD, is self-funded through label fee payments to HUD. How many functions of the federal government have no financial drain on the government's resources?
Failure to act will eliminate the financing options for all potential purchasers in the very lowest economic sector of our market, those people trying to purchase homes under $78,000. Our industry's average loan is $58,000. The single-wide market would essentially be destroyed.
Failure to act will eliminate all financing options for about half of the existing 8.8 million manufactured home owners who may try to sell their homes, so they also have an incentive to contact their congressman and senators.
Your congressman should be receptive to our industry's message. You do need to get in front of him or her. Getting to Washington, D.C. may be cost prohibitive, but getting to the congressional offices in each of your home states should be doable.
A pressing need at the moment is to find a Democratic senator to help roll out a senate version of H.R. 3849. Senator Tom Coburn (R, OK) has agreed co-sponsor the bill on the Senate as long as we have a Democratic co-sponsor who has the approval of Senator Harry Reid for the roll out. Please inform me if that occurs and I will inform Senator Coburn. # #
Post submitted by MH Retailer
HomeMart, Tulsa, OK
(Editor's Note: the link to the online resources above were added for your convenience. You can find your elected representatives at this link here. You can pass along a free 'third party' resource for manufactured home owners and residents to consider and engage on this issue at this link here. Our thanks to Doug Gorman for the column and for his years of ongoing volunteerism and service in manufactured housing. Others are encouraged to comment or share their own Industry Voices Guest Column about this or other topics of Manufactured Housing Industry interest. You can submit a column by emailing firstname.lastname@example.org with the words Industry Voices Guest Column submission in the subject line.)