LOs!
With all that's been going on lately with the agencies, it's easy to miss some news.
Earlier this month, the FHA moved to revitalize its Title I manufactured housing loan program by updating its criteria for income and property valuations.
This is the first consolidation of policies for the Title I program in almost 40 years (!) and will remove the need for lenders to sift through over 120 separate policy documents, according to the Biden administration.
Changes include the implementation of enhanced value determinations, which will now use a "sales comparison approach," and allowing for qualified FHA roster appraisers to perform valuations.
Another notable addition is that a borrower's student loan debt will be calculated on par with FHA's Title II mortgage insurance programs and the administration will allow the use of gift funds from eligible sources.
The changes can be implemented immediately but must be implemented for loans closed on and after May 9, 2022, the FHA said.
This so-called facelift to the Title I loan program by the FHA comes at a time of increased interest in manufactured housing.
In September, the White House announced that it intends to address the lack of affordable housing in the nation by upping the available supply of MH through Freddie Mac.
The Biden administration also called on state and local governments to "reduce zoning and financing barriers to these kinds of housing."
Lenders and fair housing advocates have argued for some time that MH could be a "game changer" and "the future of affordable housing" and that it has not gotten the attention that it deserves both from lenders and borrowers.
David Battany, executive vice president of capital markets at Guild Mortgage, noted in an interview that "the borrower for whom this option would fit has probably never heard of these houses before, or if the borrower does want a MH, they may be wanting a lower price point."
"It hasn't taken off yet, but I think it will be a wave of the future," he added.
Tell me, LOs, what are your thoughts on manufactured housing? Is FHA's Title I loan program gaining some traction? Is manufactured housing the wave of the future?
Please send me your thoughts at mvolkova@housingwire.com.
Maria Volkova
Mortgage Reporter, HousingWire
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