Don't forget to tune into KFBK Radio on Sunday, Jan 22 for THE REAL ESTATE SHOW with Terry Knight. I will be aguest on the show.
We will discuss mobile home transactions, manufactured home parks, buying and selling mobile homes, mobile home short sales, and mobile home lending!
The weekly Real Estate Show is heard on 92.5FM and 1530 AM in Sacramento. (I will be on during what is normally the time slot for Rush Limbaugh during the week).
Please call in and ask me a question about mobile home transactions.
Friday, December 30, 2011
Wednesday, December 14, 2011
I Will Be A Guest On KFBK Real Estate Show, Sunday Jan 22, One-Hour Show on Mobile Homes and Manufactured Homes, 92.5 FM & 1530 AM, with Terry Knight
I will be a guest on THE REAL ESTATE SHOW on KFBK Radio, Sunday morning, Jan. 22nd, 2012, at 10 a.m.
The host of "The Real Estate Show", Terry Knight, has invited me to be a guest. We will discuss mobile home transactions, buying and selling mobile homes, financing mobile homes, and all aspects of the manufactured home and mobile home business.
CALL IN and ask me a question!
The Real Estate Show with Terry Knight is a very popular weekly radio show in Sacramento, heard on both 1530 AM and 92.5 FM. This show has been on the air for many years. The host, Mr. Kngight, seems very interested in this subject and has knowledge of manufactured housing.
The host of "The Real Estate Show", Terry Knight, has invited me to be a guest. We will discuss mobile home transactions, buying and selling mobile homes, financing mobile homes, and all aspects of the manufactured home and mobile home business.
CALL IN and ask me a question!
The Real Estate Show with Terry Knight is a very popular weekly radio show in Sacramento, heard on both 1530 AM and 92.5 FM. This show has been on the air for many years. The host, Mr. Kngight, seems very interested in this subject and has knowledge of manufactured housing.
Is The Rate War Over Between Mobile Home Lenders?
MH Chattel Lenders Rate War Over? and MH Lenders Choose to “Fly The Coop” On MH Co-Op Communities
FINANCING
by Dave Shanklin
BREAKING NEWS out of Seattle: CU Factory Built will be raising rates .25% on their very popular “One-Step” loan product effective December 1. This announcement seems to indicate that the “rate war” between the MH chattel lenders is coming to an end.
The “One-Step” loan, with a very low start rate for the first five years, has a new floor of only 4.75%. This is still an amazingly-low rate for manufactured homes in LLCs as personal property.
The “rate war” was hot and heavy during the summer between CU, Triad, and US Bank. We saw stunning drops in rates as our major lenders fought for top-tier borrowers applying for MH chattel loans. Stay tuned here for unfolding developments...
Other news that hasn’t changed is our industry’s lenders’ policies toward placing loans in co-op parks, also known as Resident-Owned Communities (ROCs).
Often our industry’s lenders refuse to place loans into co-op parks. As a loan officer, I’ve always questioned this policy. Co-op parks are resident-owned and therefore are very unlikely to fall into the hands of “predatory” park owners. So why do our chattel lenders say NO to ROCs?
It’s not the communities that are the issue. It’s the certificate or shares of ownership. The banks don’t wish to finance the share of ownership. If the share of ownership is included in the sales price of the home, which is usually the case, most banks won’t take it.
Since the lenders refuse to finance the share or shares of ownership, the banks are left in a precarious position in the event of default. If the home goes into repossession and someone else owns the ROC certificate, the owner of the certificate can theoretically tell the bank: “GET OFF MY LAND.” The bank will have to pull out the home and move it to a different community.
Our industry’s major lender out of San Diego, U.S. Bank, has little or no objection to financing MH’s in ROCs. They insist that the homeowner must own the share and the cost of the share needs to be separate from the home purchase. However, there are some ROCs in Coastal California that this bank won’t take due to share prices of $100,000+. This would leave the bank in a bad situation in the event of default and having to re-market the home with an additional $100,000 for the ROC certificate.
Why won’t the lenders finance the share of ownership as part of the cost of the home? There appears to be no clear answer. To date, they haven’t been persuaded to change their minds. As the trend of converting LLCs to ROCs sweeps the country, perhaps a major voice in our industry will be successful in persuading them to be more flexible. I can see a separate loan product for this with LTVs that vary case-by-case depending on the cost of the share.
If you need a loan for a home in an ROC, your best bet is to find a regional bank. Local lenders are more willing to place loans into co-op communities. The reason is they feel that ROCs are generally more desirable than LLCs and are less likely to be purchased by major corporations who might drastically increase the rent. ROCs are generally in desirable areas making it theoretically easier for the bank to re-market the home in the event of default.
Land/home communities (LHCs), for example, are an entirely different matter with obvious different legal issues. The biggest roadblock to obtaining financing in land/home communities is the lot size. It seems ironic that chattel lenders don’t care about lot size, but land/home lenders do. You can get a loan for a manufactured home in a LLC even if all the homes are squeezed in like sardines, but you can’t very easily get a loan in a LHC
given the size of the site. You may have to go with an FHA product. Last I checked, FHA has no objection to a small lot size. # #
Dave Shanklin is a loan originator with Mobile Brokers Acceptance, Fair Oaks, CA. NMLS ID #314463. He primarily handles MH chattel loans in LLC’s. Call (916) 962-7128 or (800) 401-3372 or email Info@MobileHomeDollars.com This e-mail address is being protected from spambots. You need JavaScript enabled to view it .
FINANCING
by Dave Shanklin
BREAKING NEWS out of Seattle: CU Factory Built will be raising rates .25% on their very popular “One-Step” loan product effective December 1. This announcement seems to indicate that the “rate war” between the MH chattel lenders is coming to an end.
The “One-Step” loan, with a very low start rate for the first five years, has a new floor of only 4.75%. This is still an amazingly-low rate for manufactured homes in LLCs as personal property.
The “rate war” was hot and heavy during the summer between CU, Triad, and US Bank. We saw stunning drops in rates as our major lenders fought for top-tier borrowers applying for MH chattel loans. Stay tuned here for unfolding developments...
Other news that hasn’t changed is our industry’s lenders’ policies toward placing loans in co-op parks, also known as Resident-Owned Communities (ROCs).
Often our industry’s lenders refuse to place loans into co-op parks. As a loan officer, I’ve always questioned this policy. Co-op parks are resident-owned and therefore are very unlikely to fall into the hands of “predatory” park owners. So why do our chattel lenders say NO to ROCs?
It’s not the communities that are the issue. It’s the certificate or shares of ownership. The banks don’t wish to finance the share of ownership. If the share of ownership is included in the sales price of the home, which is usually the case, most banks won’t take it.
Since the lenders refuse to finance the share or shares of ownership, the banks are left in a precarious position in the event of default. If the home goes into repossession and someone else owns the ROC certificate, the owner of the certificate can theoretically tell the bank: “GET OFF MY LAND.” The bank will have to pull out the home and move it to a different community.
Our industry’s major lender out of San Diego, U.S. Bank, has little or no objection to financing MH’s in ROCs. They insist that the homeowner must own the share and the cost of the share needs to be separate from the home purchase. However, there are some ROCs in Coastal California that this bank won’t take due to share prices of $100,000+. This would leave the bank in a bad situation in the event of default and having to re-market the home with an additional $100,000 for the ROC certificate.
Why won’t the lenders finance the share of ownership as part of the cost of the home? There appears to be no clear answer. To date, they haven’t been persuaded to change their minds. As the trend of converting LLCs to ROCs sweeps the country, perhaps a major voice in our industry will be successful in persuading them to be more flexible. I can see a separate loan product for this with LTVs that vary case-by-case depending on the cost of the share.
If you need a loan for a home in an ROC, your best bet is to find a regional bank. Local lenders are more willing to place loans into co-op communities. The reason is they feel that ROCs are generally more desirable than LLCs and are less likely to be purchased by major corporations who might drastically increase the rent. ROCs are generally in desirable areas making it theoretically easier for the bank to re-market the home in the event of default.
Land/home communities (LHCs), for example, are an entirely different matter with obvious different legal issues. The biggest roadblock to obtaining financing in land/home communities is the lot size. It seems ironic that chattel lenders don’t care about lot size, but land/home lenders do. You can get a loan for a manufactured home in a LLC even if all the homes are squeezed in like sardines, but you can’t very easily get a loan in a LHC
given the size of the site. You may have to go with an FHA product. Last I checked, FHA has no objection to a small lot size. # #
Dave Shanklin is a loan originator with Mobile Brokers Acceptance, Fair Oaks, CA. NMLS ID #314463. He primarily handles MH chattel loans in LLC’s. Call (916) 962-7128 or (800) 401-3372 or email Info@MobileHomeDollars.com This e-mail address is being protected from spambots. You need JavaScript enabled to view it .
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