Manufactured Home Lending Checklist.

PART 5

Having served the HUD MANUFACTURED HOME INDUSTRY for the past 3 decades we have been able to collect a tremendous amount of knowledge about what is requried in order to consumate most Condo Conversion, Sub-Division, Planned Unit Development (PUD) and private lot or parcel loans for HUD MANUFACTURED HOMES.

Due to recent inventory shortages in several areas there has been a rebirth of activity taking place in the Manufactured Home Community resulting in a flood of calls Nationwide from RE Professionals, Lenders, Foundation Contractors, Home Inspectors and most importantly Home Buyers and Sellers.

Thus On the Level General Contractors and MH-Processing LLC will be offering an extensive series for the next several weeks delineating the many nuances that can cause the uninformed to pull their hair out and agonize over what can often be a very arduous process.

However, just because you will be armed with a lot of very informative and useful information and knowledge will not eliminate the time you will have to dedicate to go through all the necessary steps so we still strongly recommend that you seek the advice of MANUFACTURED HOUSING PROFESSIONALS who specialize in this. Believe me it's well worth the time and money you will spend otherwise.

Having worked in the business with both borrowers and lenders, the most common complaint from the Borrower is "Why didn't my loan officer or processor tell me everything I needed right from the start?"  Instead every time I turn around, they pop up with a new condition?"

Whether you are a borrower seeking a manufactured home loan with the land or a lender trying to provide one, REMEMBER the Manufactured Home has to QUALIFY, not just the borrower!

Here is a basic checklist for ALL FHA-insured loans:

• Built after June 15, 1976. No exceptions are allowed!    Even if a home has been completely renovated, it cannot qualify.
• Engineer's Certification Report. Must state property meets the guidelines published in the Permanent Foundations Guide for Manufactured Housing, dated September 1996.

• Structural modifications or additions. Engineer's report indicating that the structural changes or additions to the property were made in accordance with the HUD Manufactured Home Construction and Safety Standards
• The home has never moved off original site. The manufactured unit must not have been installed or occupied previously at any other site or location. Manufactured units may be moved only from the manufacturer's or dealer's lot to the site on which the unit will be insured.

• All HUD tags are indicated. All manufactured homes must have an affixed HUD label (tag) located on the outside of the home. If the home is a multi-wide unit, each unit must have a HUD label. For assistance in obtaining information for a request of label verification, contact Pam Brilhart at (703) 481-2010 or fax at (703) 437-6432 for help on finding HUD tags. See IBTS form attached. www.ibts.org

• Taxed as Real Property. The manufactured home must be taxed as real property. Also Title should provide the manufactured home endorsement applicable to subject property's state: CLTA 116.5, ALTA 7, FL 7, TX T-31.
  • If the title reflects title elimination has been recorded on the manufactured home and the tax section of title verifies it as being taxed as real property, no additional conditions are required.
  • However, if the manufactured home is not taxed as real property the Title Company must provide the recorded title elimination, (aka "de title) evidence property is being taxed as real property and applicable endorsement. In some states, title may not be purged prior to paying off the lien attached to it. In this case please provide copy of front and back of title to be purged at closing to verify liens attached Home is in a Flood Zone. 
  • The finished grade elevation beneath the manufactured home, or if a basement is used, the lowest finished exterior grade adjacent to the perimeter enclosure, shall be at or above the 100 year return frequency flood elevation. A LOMA/LOMR or elevation certification showing finished grade elevation below the manufactured home is at or above the established 100 year flood plain will need to be provided. *NOTE- Flood insurance is still required regardless if property is above the 100 year Flood plain. 
  • Condominium Project. All manufactured homes located in condominium complexes must be approved by HUD's Review and Approval (HRAP) process. Appraisal form 1073 should be used for these properties. For more information for this approval process, please see Handbook 4150.1 Chapter 11.

• New Construction Manufactured Housing. New Construction Manufactured homes are required to meet all of these guidelines, and are subject to additional guidelines. For properties delivered to a site within the past 1 year the following additional documentation will be required:
  • NPCA 99a and 99b Soil Treatment
  • Certificate of Occupancy
  • Manufacturer's Warranty
  • Document purchase price and delivery/setup expense (sales contract)
  • Additional documentation may be required at UW discretion
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• As you can see there is a tremendous amount of extremely tedious details involved in facilitating everything you need for most Manufactured Home Loans. For this reason, just as RE Professinoals always recommend working with A RE PROFESSIONAL, so to should you consider working with a MANUFACTURED HOME SPECIALIST with decades of Nationwide experience in the FACTORY BUILT HOUSING INDUSTRY.