Issue link: https://read.dmtmag.com/i/251530
FEBRUARY 2014 15 THE JOURNAL based on concrete present-day loan performance data. But the one or two largest fi- nance companies that have been able to qualify under 10-10, and thereby dominate the market, have not (as far as MHARR is aware) provided that information to GNMA, and GNMA, for its part, has not forced the issue. So the "information" that is "out there" – as unreliable as it is – is almost entirely negative, and this needs to change. Fortunately, as a consequence of MHARR's outreach to advance the inclusion of all types of manufactured home loans in any final GSE re- form bill, information is beginning to emerge re- garding the performance of post-2000 law manufactured housing chattel loans, and the numbers available, so far, are impressive. A preliminary analysis indicates that delinquency rates for manufactured home loans in larger states that tend to be representative of the manufac- tured housing market as a whole (e.g., Florida) stand at less than three percent (and the default rate would be even lower because a certain num- ber of delinquencies would be cured prior to dec- laration of a default and repossession). The trend line, moreover, is also favorable, in that the delinquency rate in those states, after having risen to over three percent in 2010 – correspon- ding with the foreclosure crisis in the broader housing market – has since returned to levels consistent with pre-crisis averages. Most impor- tantly, though, this average delinquency rate for manufactured home chattel loans is less than half the national delinquency rate for all one-to-four unit residential properties, which stood at a sea- sonally-adjusted rate of 6.96 percent at the end of the second quarter of 2013, according to the Mortgage Bankers Association's National Delin- quency Survey. As this information begins to emerge – show- ing the reality of manufactured home chattel lending today, as contrasted with the skewed, distorted and ultimately biased image that persists from the 1980s and 1990s – there will be no more excuses left for FHFA concerning the full imple- mentation of DTS including chattel loans, for GNMA concerning reform of the 10-10 rule, or for the industry itself in failing to advance these crucial initiatives for years. But, Congress needs to act. The old excuses, crutches and rationalizations for discrimination are all gone. The industry is building its best homes ever. It's providing superior customer service in the wake of the 2000 law, and has righted its own ship in improving the perform- ance of its consumer loans, as the emerging data demonstrates. Now, it's time for Congress to fulfill the promise of the 2000 law and ensure the equality of HUD Code homes with all other types of housing -- including all manufactured home loans in the home financing structure of tomor- row through clear, definitive and mandatory lan- guage that will provide the essential underpinning needed to expand the availability of such financ- ing and stop any attempted regulatory discrimi- nation in the future. In MHARR's view, with no more excuses to latch onto, opening access to -- and expanding the availability of -- public and private consumer financing for manufactured homebuyers is a chal- lenge that can and must be met by the industry. Danny D. Ghorbani is President & CEO of the Manufactured Housing Association for Regulatory Reform. MHARR is a Washington, DC-based na- tional trade association representing the views and in- terests of independent producers of federally-regulated manufactured housing. Danny can be reached at 202-783-4087 T J \ 12