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Manufactured Homes Take a HIT!
In the wake of Taylor Bean Whitaker being disowned by HUD and shut down on August 4th, (they were the 3rd largest FHA lender in the nation prior to their closing) we are getting the inevitable announcements from other Government lenders about new restrictions.
Today several major FHA/VA lenders announced they have ceased funding Manufactured Housing. Considering these loans were largely funded by FHA and VA due to the guarantees that limited the lender's concerns about defaults it is hugely unlikely many investors will step up with decent financing options for manufactured housing, at least for the foreseeable future. Sure there are specialists and local banks who can fill the gap but the reason these properties are so risky is two fold: cheaper housing attracts a borrower who by definition are at higher risk to default. Banks are particularly wary of having foreclosed manufactured homes on their books because they can't sell them as easily and now...well, without financing who will buy?
News Update: 09/10/09: I was told today by a specialist manufactured lender they offer 12% interest rate to manufactured home loans. They are extremely busy picking up the pieces even at those interest rates (!) Since August, the government mortgage lenders were ... more
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