Unexplained Delays Continue on Financing – Suspicion Grows

In addition to the rapid march of the HUD program back to its pre-2000 practices, approach and excesses, the industry and consumers of affordable housing are also now faced with unexplained delays in the implementation of reforms that were intended to revitalize and expand the availability of private and public financing for manufactured homes.

Concerning private financing, the “duty to serve underserved markets” (DTS) provision remains in regulatory limbo, going on two years since it was passed by Congress. While initial rulemaking on DTS began in 2009, there has been no further progress toward a final rule and none appears to be on the immediate horizon.

With regard to public financing, Congress approved improvements to the FHA manufactured housing programs as part of the same legislation that mandated the “duty to serve.” Yet, 18 months later, FHA has still not issued final rules to implement these improvements and Ginnie Mae, waiting for such rules, has not lifted its moratorium on the securitization of manufactured housing obligations.

Thus, despite legislation designed to improve the availability of private and public financing for manufactured housing, implementation of these improvements remains effectively bottled-up and the industry continues to deteriorate as it waits for the relief Congress intended to provide. There is no apparent explanation for any of this delay which continues to devastate the industry as it keeps new lenders out of the market, but maintains the market position and current advantage of the few existing sources of financing and their affiliates.

It is, therefore, not surprising that an increasing number of grassroots industry members (particularly retailers and communities), baffled by such delays and tired of excuses from half of the industry in Washington, D.C., have become disenchanted that an industry such as manufactured housing, a leading source of affordable, non-subsidized housing and manufacturing jobs throughout the United States, is being jerked around, ignored, neglected or penalized by HUD and other federal agencies – and are looking for strong pressure to be applied in Washington, D.C. to break this logjam.

from MHARR Washington Update – January 27, 2010

MHARR is a Washington DC.-based national trade association representing the views and interests ofproducers of federally-regulated manufactured housing.

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