Late Payments on Mobile Home Loans Increase

ABA CONSUMER CREDIT DELINQUENCY BULLETIN
THIRD QUARTER 2009

Mobile Home Loans & Heloc's see increases in delinquencies

However, other loan categories see decreases in delinquencies


In a recent published article, the American Bankers Association reports that mobile home loan customers are lagging behind on their mortgage payments at a faster rate during the third quarter of 2009.

http://www.post-gazette.com/pg/10008/1026632-28.stm

The ABA reports that mobile home loan delinquencies increased from 3.53% - 3.63% from Q2 to Q3 2009.

However, during the same period, delinquencies in other loan categories decreased. Auto loans, boat loans, personal loans, and RV loans saw an improvement in late-paying customers.

Why is this important to the manufactured home/mobile home finance industry?

My main lender, and the only lender that I have that finances older mobile homes ("pre-Huds") has recently increased their rates.

This rate increase affects purchase loans for mobile homes in parks built between 1970 - 1976.

But the GOOD NEWS is this: the same lender has dropped their rates a slightly for post-Hud MH's (MH's built AFTER June 1976). The rate drop seems to be only .25%.

It's my guess that the increase in delinquencies, as reported by the ABA, may lie primarily in the pre-Hud portion of their portfolio.

Rate changes in the MH chattel finance industry occur as the result of analyzing losses in specific categories, such as older MH's v. newer MH's, and double-wides v. single-wides. The lenders make regular assessments of their portfolio's performance, and decisions to change rates have little to do with the Fannie Mae conforming rate.

AND DON'T FORGET ABOUT THE IRS FIRST-TIME HOME BUYER TAX CREDIT FOR MOBILE HOMES!!

It's still a GREAT time to buy a mobile home. Mobile homes/manufactures homes in parks DO QUALIFY for the tax credit (10% of the purchase price).