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Could MHI Have Helped Kill CFPB? Another Opportunity Missed? MH Lending, Legal Report

May 1st, 2017 Comments off
creditmemesuper-postedtothedailybusinessnewsmhpronewsmhlivingnews

Image Credits: MHI, Brands of the World, Meme Super.

As industry professionals are already aware, the CFPB has restricted high cost and other loans on manufactured homes.

In recent weeks, prior to the close of filings, MHProNews asked the Manufactured Housing Institute (MHI) if they would be filing an amicus brief in the closely followed PHH vs. CFPB case.

As previously reported by the Buckley Sandlers law firm, MHProNews learned that PHH Corp. v. CFPB is set to be heard on May 24, 2017.

Several operations and organizations have been among those who filed an amicus brief in the case. Was MHI among those organizations?

MHProNews sources say no, and MHI won’t comment.

Why?

Frank Rolfe.

The folks at MHI – the industry lobby group – are nice people, but what’s with the concept of silence is golden? Negative articles on the industry are met with ‘no comment.’ Positive news opportunities are met with ‘no comment.’ I’ve never seen anything like it,” says Frank Rolfe.

When you refuse to talk, it looks to the public like an admission of guilt, and when you refuse to promote your product it looks like you are embarrassed by it.”

Silence, according to Rolfe, isn’t golden.

The appearance, per Rolfe, is that someone – in this case, MHI – is hiding something.

 

Who Filed Briefs Supporting PHH’s anti-CFPB case?

Per Buckley-Sandlers law, while MHI failed to file an amicus brief that may have achieved what years of lobbying has failed to accomplish, the following entities did file briefs in support of PHH’s case against the CFPB.

BuckleySandlerLawLogo-PostedDailyBusinessNewsMHProNews

Buckley Sandler logo, shown here under fair use guidelines.

DOJ Brief. As previously covered by InfoBytes, the DOJ filed its own brief in the case on March 17, arguing in support of the D.C. Circuit panel’s initial ruling and proposed remedy. The DOJ brief stated, among other things, that, “[w]hile we do not agree with all of the reasoning in the panel’s opinion,” the DOJ agrees with the panel’s conclusion that “a removal restriction for the Director of the CFPB is an unwarranted limitation on the President’s executive power” and that “the panel correctly concluded … that the proposed remedy for the constitutional violation is to sever the provision limiting the President’s authority to remove the CFPB’s Director, not to declare the entire agency and its operations unconstitutional.”  As  covered recently on InfoBytes, the DOJ presented arguments that differed both from the CFPB and from the positions previously presented by the Obama Administration in briefing submitted on behalf of the United States back in December.

On April 3, the DOJ filed an unopposed motion seeking ten minutes of argument time for the United States at the May 24 en banc hearing.

Amicus Curiae in Support of PHH. The March 10 deadline in the en banc proceeding also brought about the filing of seven amicus curiae briefs in support of PHH’s claims and/or defenses. Six of these filings took the position that the Bureau’s current structure violates separation-of-powers principles:

  • Brief on Rehearing en banc of the Chamber of Commerce of the United States of America as Amicus Curiae in Support of Petitioners
  • Brief on Rehearing en banc of ACA International as Amicus Curiae in Support of Petitioners
  • Brief on Rehearing en banc of the Cato Institute as Amicus Curiae in Support of Petitioners
  • En Bank Brief of Amici Curiae RD Legal Partners, LP, RD Legal Funding, LLC, RD Legal Finance, LLC and Roni Dersovitz in Support of Petitioners
  • State National Bank of Big Spring, 60 Plus Association, Inc.; and Competitive Enterprise Institute as Amici Curiae in Support of Petitioners
  • Brief for the States of Missouri, Alabama, Arizona, Arkansas, Georgia, Idaho, Indiana, Kansas, Louisiana, Nevada, Oklahoma, South Dakota, Texas, West Virginia, and Wisconsin as Amici Curiae in Support of Petitioners

Does MHI really want to Advance MH Industry Lending? 

PrognosisOnPreservingAccessManufacturedHousing2017-MHIBill-PerPredictGov-PostedManufacturedHousingIndustryDailyBusinessNewsMHProNews

The prognosis above is posted on GovTrack and was made by PredictGov – both third parties to manufactured housing, with no stake in the matter – reflects 99 to 1 odds against the MHI bill – Preserving Access to Manufactured Housing 2017 – becoming law. Logo credit, PredictGov.

In a recent article on the Daily Business News, linked here, much of the manufactured housing industry is familiar with latest version of the Preserving Access to Manufactured Housing Act of 2017 – a.k.a. H.R. 1699. MHI’s latest “alert” urged their readers to keep up the “momentum” for the 4th iteration of a bill, yet, upon further investigation, MHProNews found that the bill has a one percent chance of passing (see graphic above, from PredictGov).

Several informed sources tell MHProNews that during a recent MHI finance discussion – contrary to official claims that they support a vigorous Duty To Serve (DTS) manufactured housing with a robust chattel program – one or more key MHI leaders expressed in small group sessions steps that would deliberately slow or minimize Government Sponsored Enterprises (GSEs) from getting involved in manufactured home personal property/home only (chattel) lending.

Beyond Preserving Access – HR 1699 – What’s Really Happening with the GSEs?

Rumblings from informed sources tell MHProNews that GSE’s may do a limited pilot chattel program, but that limited program may be “an eight to ten year process.”

If this is indeed the case, an MH industry lender told MHProNews that, …that length of time would be much longer than is necessary for them [the GSEs] to get their own data. The default curve is highest in the first 60 months,” the expert source said.

Industry Opinions on DTS Vary

While widely viewed as worth pursuing, throughout the industry, opinions on the Duty to Serve – and how it might become reality – vary.

jimayottecreditmhpronewsusersrcdesktoppaulbradleycredtimhpronewsstanthonycasehighlightsbattleovercommunityownersrightsvsresidentsrights-dailybusinessnewsThe final rule provides Fannie Mae and Freddie Mac with Duty to Serve credit for purchasing chattel manufactured housing loans, but does not mandate them to do so.  Whether the final rule is positive or negative for the industry depends on which national industry trade group you listen to,” said Jim Ayotte in a response linked here.

MHI’s take on the final rule is that it is a step in the right direction,” said Ayotte. “MHARR believes that because the FHFA did not mandate the GSEs to make chattel loans that it is highly unlikely that any chattel loans will be made.”

Ayotte sees it differently. “The truth of the matter is that the industry is closer to getting a viable secondary market program for chattel manufactured home loans than it has been in nearly two decades.  While the industry would have preferred the FHFA to mandate the GSEs to make chattel loans, this was not going to happen.  However, over the past year the GSEs have demonstrated a genuine interest in understanding chattel manufactured housing financing as it exists today, not as it performed in the late 90’s.”

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Paul Bradley. photo credit: Fosters.

We have Fannie Mae financing homes in some of our communities already,” said ROC USA President Paul Bradley, but it’s too limited.  We want a chattel pilot and standard land lease so we can scale.  It should reassure skeptics that home-only loans by the GSEs have worked in Land Lease Communities.  We need DTS to get together as a larger market opportunity for the GSEs.”

I am surprised that the Community Bankers’ Association (ICBA) would come out against GSE chattel product – from the many community bankers I’ve talked to over the years,” Bradley told MHProNews that “the local bankers want a secondary market for chattel. One of the concerns that lenders often express about manufactured home loans in Land Lease Communities is that homes there lose value.  But that is not a given.  I can point to examples in Land Lease Communities where homes are appreciating.”

Manufactured Housing Association for Regulatory Reform (MHARR) President and CEO M. Mark Weiss provided a different take.

M.Mark.WeissJDPresidentCEOMHARRManufacturedHousingAssociationforRegulatorReform-creditManufacturedHousingIndustryDailyBusinessNewsMHProNewsWe at MHARR have the greatest respect for Jim Ayotte, but his recent commentary on the final Duty to Serve (DTS) rule issued by the Federal Housing Finance Agency (FHFA) is far too charitable. It’s one thing to see the proverbial glass as half full versus half empty.  It’s another to accept a few droplets as half a glass,” said Weiss in his commentary, linked here.

And that is what consumers and the industry have gotten from FHFA – a few drops at the bottom of the glass, window dressing that is not likely to lead anywhere soon, despite the urgent need now for affordable and competitive chattel-based consumer financing for manufactured homes.”

MHARR has asked on multiple occasions for private meeting minutes between FHFA and others on the DTS issue to be disclosed.

If Congress had meant the “duty to serve” to be optional, it would not have called it a ‘duty’.  The dictionary definition of a ‘duty’ has – at its core – a mandatory responsibility,” said Weiss.

For more on DTS from Eagle One Financial VP Titus Dare, click here. ##

(Image credits are as shown above, and when provided by third parties, are shared under fair use guidelines.)

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RC Williams, for Daily Business News, MHProNews.

Submitted by RC Williams to the Daily Business News for MHProNews.

Could Modular Determine the Outcome of an Election?

April 14th, 2017 Comments off

A modular unit in London. Credit: The Guardian.

For incumbent London Mayor Sadiq Khan, the answer could very well be yes.

According to Property Week, the importance of addressing London – and the U.K.’s – affordable housing crisis was front and center in a discussion on the mayor’s performance among developers and professionals gathered in Cannes.

The message was clear: Khan needs to pick up the pace if he plans on being re-elected.

But one move could make a striking difference to perceptions of the mayor’s progress – removing barriers and accelerating the use of modular housing for London’s new homes,” said David Sheridan, CEO of Keepmoat.

CouldModularDeterminetheOutcomeofanElectioncreditPropertyWeek1-postedtothedailybusinessnewsmhpronewsmhlivingnews

David Sheridan. Credit: Property Week.

Sheridan believes that modular housing “is a feature of the normal rather than something that is unusual – but this view will take time to embed.”

Perhaps it is memories of system-built or prefabricated post-war homes that is holding the capital back – but if London throws off these shackles the rate of house building could increase dramatically and potentially play a big role in Mayor Khan’s re-election,” said Sheridan.

Sheridan says that the group realized that there was much to learn from other sectors, including those that build schools, when it comes to modular construction. The group also came up with a plan for the Greater London Authority to stimulate and invest in modular construction, including working with boroughs to standardize design, secure grant funding, and developing a framework of partners to speed development.

Output from traditional house building methods is constrained and close to its limit – with the availability of labor only set to tighten further as Britain prepares to leave the European Union,” said Sheridan.

The answer is in the existence of a number of progressive players delivering modular products that can be applied to different site challenges. These products will add to the supply from traditional house building, not replace it. Modular systems have the potential to accelerate estate regeneration; they can be used to provide new homes on top of existing buildings and on small infill sites. They also offer high-quality homes that can blend into the suburbs.”

Sheridan also believes that modular construction can reduce the upheaval on residents, by offering high-quality housing requiring much shorter construction periods.

We are talking about installation of up to eight homes a day,” said Sheridan.

CouldModularDeterminetheOutcomeofanElectioncreditPropertyWeek2-postedtothedailybusinessnewsmhpronewsmhlivingnews

Mayor Sadiq Khan. Credit: Property Week.

He also had a suggestion for the Mayor with regard to re-election.

With the clock ticking on his mayoralty, there is nothing Mayor Khan could do more effectively to speed up housing supply than making London an exemplar for modular construction over the next three years,” said Sheridan.

For more on modular and prefab housing in the U.K., including China National Building Material Company (CNBM), Barcelona Housing Systems and U.K. housing association Your Housing Group (YHG) joining forces to build six prefab factories that will deliver 25,000 energy efficient homes per year by 2022, click here. ##

 

(Image credits are as shown above.)

 

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RC Williams, for Daily Business News, MHProNews.

Submitted by RC Williams to the Daily Business News for MHProNews.

Zoning Changes Could Affect Manufactured Housing

March 1st, 2017 Comments off
ZoningChangesCouldAffectManufacturedHousingcreditMHProNews-postedtothedailybusinessnewsmhpronewsmhlivingnews

A manufactured home community in Michigan. Credit: MHProNews.

The Washington County, Maryland Board of Commissioners is holding a public hearing today regarding several proposed changes to the county’s zoning ordinance, including ones that affect manufactured homes.

According to the Herald-Mail Media, zoning amendments are proposed to the 1973 ordinance from time to time due to changing times and technology.

Current law states a mobile home [sic] can only be replaced with one that fits on the existing foundation, which does not allow for expansions to double-wides [sic],said Chief Planner Jill Baker.

The proposed change would create some flexibility, allowing for such replacements as long as setback requirements are met.

Existing manufactured homes with a smaller setback would be grandfathered in, but must meet their existing property setback with replacement homes.

The proposed amendments would also disallow accessory structures such as sheds or pools, in-ground or above ground, in front yards.

Some residents voiced concerns about such items in front yards, and they create problems for potential road widening and highway right of way projects, according to county documents on the matter.

As Daily Business News readers are aware, a number of zoning related stories have been in the news lately, including a case in Wilmington, North Carolina, where city leaders are moving forward with a plan to rezone parts of an area that includes the Melrose Mobile Home Park, where residents will be required to move.

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Rhonda Pythress. Credit: TWC News.

It is all about money. At Wrightsville Beach they want this property so they can zone it so they can build more rich condos here,” said resident Rhonda Poythress.

Also of note is the case of the Boulder City Mobile Home Park in Boulder City, Nevada, where the area around the community was re-zoned to a multi-home residential area.

Those who commented on the matter didn’t pull any punches.

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Boulder City Mobile Home Park. Credit: KTNV

I like the residential idea because it would not be a trailer park [sic] anymore,” said councilman Cam Walker.

Developer and board member Randy Schams, who asked for the rezoning, echoed Walker’s sentiment.

I have been building here for 20-plus years and I have never heard one positive thing about that trailer park [sic],” said Schams.

I am just trying to make it more appealing and with affordable housing.##

(Image credits are as shown above.)

 

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RC Williams, for Daily Business News, MHProNews.

Submitted by RC Williams to the Daily Business News for MHProNews.

Bill Could Improve Economic Mobility for MH Owners

February 22nd, 2017 Comments off
BillCouldImproveEconomicMobilityforMHOwnerscreditIsemanHomes-postedtothedailybusinessnewsmhpronewsmhlivingnews

A manufactured home in Wyoming. Credit: Use Man Homes.

Wyoming, a state with one of the highest populations of people residing in manufactured homes, is working on leveling the playing field for owners.

According to Wyoming Public Media, the state does not currently extend the same rights to manufactured home owners as it does for site built homeowners, but House Bill 56, which is now before the Senate, would fix an oversight in how manufactured homes are titled.

Representative Tyler Lindholm (R-Sundance) sponsored the bill, after hearing from a constituent who was struggling to get a title because he needed one that assessed his manufactured home and his land as one piece of property.

BillCouldImproveEconomicMobilityforMHOwnerscreditWikipedia-postedtothedailybusinessnewsmhpronewsmhlivingnews

Rep. Tyler Lindholm. Credit: Wikipedia.

Without an accurate title, the constituent could not get a loan or mortgage on his property.

This causes a headache for financial institutions, and ultimately limits the economic mobility of mobile [sic] homeowners,” said Lindholm.

It affects a huge amount of people who have gone through this problem over the years, and it closes this loop hole in our law where people will actually be able to get loans on their property if they so choose.

The bill clarifies the transfer of titles for manufactured homes from one owner to another, and takes into account that the home might also be moving from one piece of land to another.

With the high number of state residents who live in manufactured homes, Lindholm believes this can help many residents who are currently stuck in limbo.

Banks won’t deal with them, and title companies are scrambling to get them a title but they can’t because of this little tiny hole in Wyoming law, said Lindholm.

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Mountain View Estates, Laramie, Wyoming. Credit: Shannon Broderick.

As Daily Business News readers are aware, the state of Wyoming has been working on various ordinances for manufactured housing and RV’s over the last year, in addition to House Bill 56. For more on the MH and RV ordinances, click here. ##

 

(Image credits are as shown above.)

 

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RC Williams, for Daily Business News, MHProNews.

Submitted by RC Williams to the Daily Business News for MHProNews.

12,000 Modular Homes Could Be Coming to This City

February 1st, 2017 1 comment
12000ModularHomesCouldBeComingtoThisCitycreditChicagoSunTimes-postedtothedailybusinessnewsmhpronewsmhlivingnews

The Lakeshore site that will host a factory and 12k modular homes. Credit: Chicago Sun Times.

Thanks to a combination of a deal between steel giant U.S. Steel and prominent developer Dan McCafferty going bad, and a new joint venture between Barcelona Housing Systems and WELink, Chicago could be in a position to not only get a manufacturing plant along the city’s iconic Lakeshore Drive, but also 12,000 modular homes.

According to the Chicago Sun Times, the joint venture has emerged as the winning bidder for the massive site.

They did their due diligence, and they’ve got all of their ducks in a row,said Ald. Susan Sadlowski Garza.

They’re gonna be building a manufacturing [plant] on the property where they’re going to be building modular homes. They’ve done it in Barcelona and Argentina. It’s a new, innovative product that’s never been here before.

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Credits: Barcelona Housing Systems, WELink.

As Daily Business News readers are aware, the Barcelona Housing System/WELink joint venture recently partnered with Chinese firm CNBM and announced plans for modular home factories in the U.K.

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Jorge Ramirez. Credit: Chicago Federation of Labor.

Jorge Ramirez, President of the Chicago Federation of Labor, said that he was excited about the prospect of major development and being able to get hundreds of skilled builders back to work.

I’ve just got to make sure that there’s a meeting of the minds as to how these things are gonna get done. That they’re not cutting corners or [compromising] safety standards,” said Ramirez.

They’re lifting people up into the middle-class and respecting labor. All of the run-of-the-mill standard types of concerns.”

Garza says that they also thoroughly vetted all 13 bidders for the project before narrowing the list to three finalists, scrutinized even more to make certain they had the financing, know-how and experience to do a project of this size.

Even though 12,000 homes and a factory is a large order, Garza is confident about the joint venture and their ability to deliver.

They took their time to learn about the neighborhood and find out what people want here,” said Garza.

12000ModularHomesCouldBeComingtoThisCitycreditNLGChicago-postedtothedailybusinessnewsmhpronewsmhlivingnews

Ald. Susan Sadlowski Garza. Credit: NLG Chicago.

With their know-how, their capital and the people they have working with them, I have the utmost confidence they’re gonna do this. I’ve seen some of the work that they’ve done in Barcelona and it’s really incredible. They can build a three-flat in like 30 days. It’s all up to code. We’re not gonna have to wait 20 years to see movement.

The modular home portion of the project is slated to happen in four phases of 3,000 homes each, and the new plan calls for retail and recreational space.

And Garza is excited about the efficiency.

They don’t have to dig a foundation. They screw pylons into the ground. They can withstand a 7.8 earthquake. It’s just a new technology. The factory is going to be huge to build this much of a development,” said Garza.

And once we start building homes, three-flats and four-flats, then come the stores and the other amenities. They incorporate a lot of green space and green technology. Access to the lakefront for all. Stuff that’s been really important to this neighborhood for a very long time.” ##

(Image credits are as shown above.)

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RC Williams, for Daily Business News, MHProNews.

Submitted by RC Williams to the Daily Business News for MHProNews.

Trump’s Regulation Cuts Could Have Major Impact on MH

January 23rd, 2017 Comments off
TrumpsRegulationCutsCouldHaveMajorImpactonMHcreditAmericaEnterpriseInstitute-postedtothedailybusinessnewsmhpronewsmhlivingnews

Credit: American Enterprise Institute.

Throughout the 2016 presidential campaign, Donald Trump was very clear on one thing he wanted to change – regulations.

President Trump talked about the Obama-era financial regulations, including Dodd-Frank, as “bad for business” and responsible for the nation’s slow growing economy.

 

For many, the President’s anti-regulatory stance is a welcome breath of fresh air.

According to Business Insider, the financial services industry is particularly excited, seeing the Trump victory as an early Christmas present.

TrumpsRegulationCutsCouldHaveMajorImpactonMHOctavioMarenzicreditOptimas-postedtothedailybusinessnewsmhpronewsmhlivingnews

Octavio Marenzi. Credit: Optimas.

This isn’t going to necessarily translate into a golden age for banks, but it will be a normalization of the business environment. They’ve been battered by regulations and now we are finally going to see a more healthy environment,” said Octavio Marenzi, CEO of Opimas, a management consultancy firm focused on capital markets.

Our analysis shows that efforts to deregulate could redirect more than $25 billion in capital in the financial services industry over the course of the next 18-24 months,” said Opimas co-founder Medy Agami.

Areas in the analysis by Opimas that are of particular interest to the manufacture housing industry:

  • The roll back of Dodd-Frank and the elimination of the Consumer Financial Protection Bureau (CFPB).
cfpb-parody-logo-credit-plus1properties-cartoon-credit-MHProNews-com-(c)2015-all-rights-reserved-

Credit: Plus 1 Properties, MHProNews.

The elimination of or serious reduction in CFPB regulations will mean a potential savings of nearly $1.4 billion for banks,” said Marenzi.

Additionally, Treasury Secretary nominee Steven Mnuchin has said that the new administration plans to “strip back parts of Dodd-Frank that prevent banks from lending.

As Daily Business News readers are aware, Republican Senators Bob Sasse (NE) and Mike Lee (UT) have called for the removal of CFPB director Richard Cordray, and Democratic lawmakers have called on the Trump Administration to keep Cordray and the agency in tact as is.

CourtRulesCFPBStructureUnconstitutionalcreditwikipediacfpbhubpages

Credit: Wikipedia, CFPB, HubPages.

A D.C. circuit court ruled last year that the CFPB was unconstitutional.

  • Repeal of the “Volcker Rule”

Enacted in 2013, the rule was designed to prevent future financial crises. Agami and Marenzi believe that the rule is the easiest to roll back, because all the President would essentially need to do is tell regulators to stop enforcing it.

TrumpsRegulationCutsCouldHaveMajorImpactonMHMedyAgamicreditOptimas-postedtothedailybusinessnewsmhpronewsmhlivingnews

Medy Agami. Credit: Optimas.

The implications will be significant for large investment banks since dropping the rule would generate additional revenue and profitability streams,” said Agami.

There is also significant evidence that repealing The Volcker Rule will increase liquidity in various asset classes—fixed income, equities, commodities, foreign government debt, etc.—by enabling dealers to hold inventory that has long-term demand from clients that would otherwise not be allowed,” said Marenzi.

  • Reductions in capital and liquidity requirements
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A Clayton home in Chino Valley. Credit: Clayton Homes.

Originally put in place to prevent risky lending by financial institutions, Marenzi and Agami see significant reductions in the requirements freeing up money hoarded by banks.

It will free up nearly $20 billion in unproductive capital over the next 18-24 months that banks are hoarding and could redirect to other areas,” they said.

These regulations will be the most difficult to scale back since they are globally implemented and compelled banks to build myriad models and retain armies of risk and compliance teams.

Movement in these areas, combined with incoming Secretary of Housing and Urban Development (HUD) Dr. Ben Carson, could bode very well for the manufactured housing industry as regulations decrease and capital flows improve.

For more on Dodd-Frank, the CFPB and their impact on the manufactured housing industry, click here. ##

(Image credits are as shown above.)

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RC Williams, for Daily Business News, MHProNews.

Submitted by RC Williams to the Daily Business News for MHProNews.