MHI Board of Directors Member F. R. Jayar Daily told a congressional subcommittee on housing and insurance that “Manufactured homes are the most affordable homeownership option in the market today,” but the regulatory burdens and the lack of a secondary market for chattel loans reduce financial access for millions of Americans who seek homeownership.
Testifying before the U.S. House Financial Services Committee’s Subcommittee on Housing and Insurance entitled “The Future of Housing in America: Government Regulations and the High Cost of Housing,” he said the industry is regulated by the Department of Housing and Urban Development (HUD), but the outdated regulations add to the cost of the home.
The housing finance system does not meet the needs of borrowers, as MHI tells MHProNews. Even FHA’s chattel loan program does not work—there was only $24 million in endorsements in 2015, and 80 appraisers in the whole country. The HOEPA provisions governing small-balance loans, and the definitions of a loan originator are also holding back the possibility for home ownership.
He said the duty-to-serve provision was included in the 2008 Housing and Economic Recovery Act, but only now has a proposal been made for the possibility of a secondary market for chattel loans with Fannie and Freddie.
Noting that the homes are required to be on steel chassis, which limits innovation, Daily said the Manufactured Housing Construction and Safety Standards Act of 1974, “legislation that brought the industry into the modern era,” is outdated. As an example, HUD has stringent production rules, quality assurance and dispute resolution systems under the HUD Code, yet the industry remains under the federal lemon law.
He said, we need “to alleviate the challenges facing working families, seniors, and young professionals seeking quality affordable homeownership opportunities.” ##
Article submitted by Matthew J. Silver to Daily Business News-MHProNews.