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.
Showing posts with label i need a mobile home loan in sacramento. Show all posts
Showing posts with label i need a mobile home loan in sacramento. Show all posts
Friday, December 30, 2011
Wednesday, December 14, 2011
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 .
Thursday, August 11, 2011
Major Mobile Home Lender Lowers Rates to 4.5% for Used and New Mobile & Manufactured Homes in Parks
Our industry's major lender out of Seattle, CU Factory Built Lending, has again rolled out a new loan product with eye-popping low rates for manufactured homes in leased land communities.
Their new floor rate is 4.5%. This is a "step-up loan", not an adjustable rate mortgage. The low start rate is locked in for the first five years, then "steps up" to the higher rate for the remiaining term at 7.25% fixed. This lender's loan products are always fully amortized. The terms are very flexible and not too difficult to qualify for. They don't accept applicants with any mortgage defaults or any mortgage delinquencies in their background.
For example, a used 1980 multi-section in-park home would qualify with 10% down. Assuming top tier credit, the applicant can get a 20-year loan at 4.75% for the first five years, and 7.5% for the remining 15 years. With 20% down, the start rate would be 4.5%, stepping up to 7.25%.
Better yet, for a 10-year loan, with 20% down, the first five years will be fixed at 4.5%, and the remaining years fixed at 6.25%. The borrower may pay the monthly based on the higher rate, resulting in an accelerated principal reduction, and saving thousands in interest.
This new "One Step Program" loan product is available in all states. Cash-outs and refinances are also eligible, case-by-case. In CA, the older "pre-Huds" are eligible, but with a 1% rate adder.
This will make financing new and used MH chattels much easier. Our industry needs a good shot in the arm.
Their new floor rate is 4.5%. This is a "step-up loan", not an adjustable rate mortgage. The low start rate is locked in for the first five years, then "steps up" to the higher rate for the remiaining term at 7.25% fixed. This lender's loan products are always fully amortized. The terms are very flexible and not too difficult to qualify for. They don't accept applicants with any mortgage defaults or any mortgage delinquencies in their background.
For example, a used 1980 multi-section in-park home would qualify with 10% down. Assuming top tier credit, the applicant can get a 20-year loan at 4.75% for the first five years, and 7.5% for the remining 15 years. With 20% down, the start rate would be 4.5%, stepping up to 7.25%.
Better yet, for a 10-year loan, with 20% down, the first five years will be fixed at 4.5%, and the remaining years fixed at 6.25%. The borrower may pay the monthly based on the higher rate, resulting in an accelerated principal reduction, and saving thousands in interest.
This new "One Step Program" loan product is available in all states. Cash-outs and refinances are also eligible, case-by-case. In CA, the older "pre-Huds" are eligible, but with a 1% rate adder.
This will make financing new and used MH chattels much easier. Our industry needs a good shot in the arm.
Friday, July 16, 2010
Heat Wave Slows Down Mobile Home Buying
Every year, in the doldrums of July, my mobile home finance "hotline" isn't so hot.
Buyers are staying home and avoiding the triple-digit heat, not looking at mobile home parks.
But this is just a temporary thing. Great bargains await for those who seek them!
Call any time for advice on mobile home loans.
800-401-3372
Buyers are staying home and avoiding the triple-digit heat, not looking at mobile home parks.
But this is just a temporary thing. Great bargains await for those who seek them!
Call any time for advice on mobile home loans.
800-401-3372
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