| With the increasing popularity of the Reverse | | | | tires and axles have been removed or some |
| Mortgage loan product for those homeowners 62 | | | | other vague set of standards, not on the |
| and older, loan processors are dealing more | | | | basis of the foundation attachment. |
| and more with manufactured homes in their | | | | |
| portfolios. Many seniors have chosen the | | | | The reason for this requirement is to |
| manufactured home communities as a retirement | | | | establish a national standard of consistency |
| refuge and the community and recreational | | | | amidst inconsistent state installation |
| atmosphere lend itself well to word-of-mouth | | | | standards. While manufactured homes have |
| referrals and the spreading the news about | | | | standardized preemptive structural, plumbing, |
| FHA and Reverse Mortgage Loans benefits. | | | | and electrical standards that need to be met |
| However, the manufactured home loan presents | | | | before leaving the factory, installation |
| a new set of criteria for the loan officer | | | | standards vary from county to county, state |
| and loan processor as well as the borrower so | | | | to state. Additionally, manufactured homes |
| be prepared ahead of time. Certain criteria | | | | are unique in that they can either be titled |
| are absolutes: | | | | either as personal property (chattel) or real |
| | | | property. In some states the distinction |
| 1. The manufactured must be a HUD home, which | | | | between personal and real property is |
| means it must be manufactured after June 15, | | | | determined by the type of foundation and |
| 1976. If there are metal plates at the rear | | | | underpinnings that support the home. Since |
| of the home that begin with a three Alpha | | | | the individual jurisdictional requirements |
| letters like CAL, ARZ, ORE, that's usually a | | | | vary significantly, the Engineer |
| good sign. If the HUD label is missing, | | | | Certification Letter helps to provide a |
| usually a label verification letter from the | | | | standard for excellence. This is generally an |
| Institute for Building Technology and Safety | | | | underwriting requirement for all FHA insured |
| (IBTS) which will give the provenance of the | | | | loans, which also include Reverse Mortgages. |
| home will suffice. 2. The Manufactured homes | | | | |
| and FHA Insured Loans is classified and taxed | | | | If an existing home is already on a |
| as real estate. A long term lease may also be | | | | foundation, an engineer can provide a |
| acceptable in certain instances. 3. The axles | | | | certification attesting to the fact that the |
| and tongues must be removed. 4. The | | | | home meets the guidelines. If it does not |
| manufactured home must have an adequate | | | | meet the HUD guidelines, there are a variety |
| perimeter enclosure with appropriate | | | | of proprietary or approved engineered |
| ventilation. 5. Must have a floor area of not | | | | foundation Retrofitting systems in |
| less than 400 square feet 6. Built and | | | | combination with the existing structural |
| remains on a permanent chassis 7. The | | | | components. As in any industry, one size does |
| finished grade elevation beneath the | | | | not fit all in the engineering landscape and |
| manufactured home shall be at or above the | | | | engineers that specialize in the manufactured |
| 100 year return frequency flood elevation. 8. | | | | home industry and the HUD inspection |
| The home must sit on a permanent foundation. | | | | specifications are even rarer still. Because |
| | | | there are a vast array of proprietary |
| AND All foundation systems, new and existing, | | | | products that have been introduced into the |
| must meet the guidelines published in the HUD | | | | national marketplace, knowledge about these |
| Permanent Foundations Guide for Manufactured | | | | systems is also an additional benefit since |
| Housing, (HUD-7584), dated September 1996. A | | | | these have all been pre-engineered and |
| certification attesting to compliance with | | | | stamped delineating all of the system |
| this handbook must be obtained from a | | | | specifications. This also means if the |
| licensed professional engineer and included | | | | foundation does not meet the FHA-insured |
| in the insuring file. | | | | criteria for a permanent foundation, the |
| | | | engineer does not need to re-invent the wheel |
| This last requirement can throw the loan | | | | with a repair recommendation---there are a |
| processor into a quandary if they have never | | | | plethora of products available for the |
| expedited a manufactured home transaction | | | | retrofit contractor. Therefore finding the |
| previously because this request will often | | | | right combination of an engineer and |
| show up at the 11th hour of loan closing. | | | | contracting team that understands the FHA |
| Nine times out of ten the appraisal report | | | | lending process so the engineering |
| will show that the home is on a foundation | | | | certification does not impair the loan lock |
| system so the processor or loan officer won't | | | | timeline, is familiar with the availability |
| have alarm bells off of worry going off when | | | | of proprietary systems that can resolve the |
| they receive this condition. Unfortunately, | | | | repair issues if they are necessary and are |
| the appraiser often simply determines | | | | able to liaison with both lender and borrower |
| "permanence" strictly on the basis that the | | | | to provide turn-key solutions. |