Posts Tagged ‘hoepa’

Data Confirms Dodd-Frank Regulations Impede Manufactured Home Loans

September 28th, 2015 Comments off

MH two story for sale   greg vote getty images creditThe Manufactured Housing Institute (MHI) informs MHProNews that data regarding lending at 7,000 financial institutions and covering nearly 10 million mortgage applications and six million loan originations reveals manufactured home lenders are not making HOEPA (Home Ownership and Equity Protection Act) loans because of the increased liability and burdensome rules of smaller loans, like many MH loans.

Opponents of the Preserving Access to Manufactured Housing Act have been arguing that consumers will lose the HOEPA high cost protection if the legislation passes, when in fact lenders simply are not making loans and are leaving the market and consumers are the ones hurt the most since Dodd-Frank took effect.

A report from the Federal Reserve 2014 Home Mortgage Disclosure Act (HMDA) data describes the decrease in MH loans, saying it is “a precipitous drop in the number of loans originated in 2014 at the HOEPA price threshold, whereas, for 2013 – before the new threshold rules took effect – no such discontinuity was evident. This pattern suggests that HOEPA discouraged lending above the price thresholds.

Many retirees, veterans and working families are unable to obtain financing to purchase manufactured homes; and those who may want to sell their MH see their home values decline because potential buyers cannot find appropriate financing as lenders no longer offer suitable loan products, resulting in home owners selling for cash at a substantially reduced price.

These federal government policies are destroying family net worth and harming the ability of credit-worthy families to achieve the American dream of homeownership,” says MHI.

The Preserving Access to Manufactured Housing Act (H. R. 650), which has already passed the House of Representatives, will restore financing options for MH buyers and provide core consumer protections against predatory lending.

In the Senate, the measure (S. 682) is included in a larger financial regulatory relief package that was passed by the Senate Banking Committee (S. 1484) and the Senate Appropriations Committee.

The MHI urges you to contact your members of Congress and remind them of the importance to their constituents of the Preserving Access to Manufactured Housing Act. Click here to send them an email. ##

(Photo credit: Getty Images/Greg Vote–manufactured home for sale)

matthew-silver-daily-business-news-mhpronews-comArticle submitted by Matthew J. Silver to Daily Business News-MHProNews.

Former Head of Manufactured Housing at HUD Urges Passage of S. 682

August 7th, 2015 Comments off

william_matchneer__bradley_arant_boult_cummings__housingwire__creditWilliam Matchneer, who once served as head of the Manufactured Housing Program at the Department of Housing and Urban Development (HUD), and from 2011 to 2014 with the Consumer Financial Protection Bureau (CFPB), recounts how implementation of the Dodd-Frank Act directives for High-Cost Mortgages under the Home Ownership and Equity Protections Act (HOEPA) negatively impacts the sale of MH under $20,000.

Now with Bradley Arant Boult Cummings LLP, Matchneer helped write the implementing regulations for the Dodd-Frank appraisal provisions, while other CFPB attorneys wrote the Dodd-Frank lending provisions to establish HOEPA thresholds.

Writing in jdsupra, he states, “Under current law, manufactured housing chattel loans are covered by HOEPA if the annual percentage rate (APR) exceeds the average prime offer rate (APOR) by more than 8.5% for loans of less than $50,000. However, given all the additional requirements for points and fees that come with the new HOEPA rules, chattel loans below $20,000 are simply not economical. As a result, most if not all lenders have simply stopped making these loans.

This hurts some of the most seriously disadvantaged, those with homes valued under $20,000, the very ones the CFPB says it is designed to protect, forcing them to accept cash offers in many case well below market value.

The Dodd-Frank statute does offer to the CFPB the authority to exempt certain loans from HOEPA coverage, but so far CFPB czar Richard Cordray has been unwilling to raise the thresholds.

H.R. 650, the bipartisan Preserving Access to Manufactured Housing Act did pass the House of Representatives in April, and it amends the thresholds in section 103 of the Truth in Lending Act (15 U.S.C. 1602) to APOR plus 10% for transactions under $75,000. This would protect the estimated 1.7 million manufactured homes with a loan balance below $20,000. It still manages to maintain consumer protections from predatory lending practices in Dodd-Frank. The companion bill in the Senate, S. 682, is currently in the hands of the Senate Banking Committee.

These bills would also exclude a retailer of manufactured homes or its employees from being classified as a loan originator and therefore subject to SAFE Act licensing and NMLS registration. Under current Dodd Frank/CFPB regulations, retailers cannot offer one iota of information to prospective consumers about MH financing.

For the MHLivingNews interview with Matchneer, please click here.##

House Financial Services Committee Passes H.R. 1779

May 22nd, 2014 Comments off

The U. S. House of Representatives Financial Services Committee passed the bipartisan Preserving Access to Manufactured Housing Act (H.R. 1779) which protects the ability of manufactured home (MH) consumers to buy, sell and refinance affordable manufactured homes. The measure would alter the Dodd-Frank Act in addressing criteria by which MH loans are classified as high-cost. Noting it is the largest form of unsubsidized affordable housing in the nation, Nathan Smith, Chairman of the trade association Manufactured Housing Institute (MHI), said, “The ability to access affordable manufactured homes is vital to millions of low- and moderate-income Americans, and our industry is also an important economic driver and job creator in many communities across the country. This legislation would ensure that manufactured housing remains a viable affordable housing option, particularly in rural, distressed and underserved areas. We urge the full House of Representative to move swiftly to consider this important legislation.”

The Consumer Financial Protection Bureau (CFPB), in failing to recognize the uniqueness of manufactured home loans, defines many small balance loans used to buy MH as predatory and high cost: The dollars to originate and service a $250,000 loan is the same as a $25,000 loan, but the percentage cost of each loan is greatly different, and may put the MH loan in the category of a HOEPA high-cost loan, making it unlikely they will be offered to buyers because of the increased lender liabilities. According to the American Housing Survey, since roughly half of the nation’s 8.5 million manufactured homes have a purchase price of less than $30,000, those of less modest means who also do not qualify for traditional mortgages could be shut out of the housing market altogether. In addition, current MH owners would have difficulty refinancing their homes.

H.R. 1779 would also make it clear that MH salespeople are not loan originators lest they are being paid by a lender. The bill has support from 113 legislators on both sides of the aisle. For additional information, please click here. MHProNews understands there is a similar bill in the Senate, S. 1828. ##

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House Financial Services Committee Voice Votes “Yes” to H.R. 1779

May 9th, 2014 Comments off

The Manufactured Housing Institute (MHI) informs the House Financial Services Committee adopted, by voice vote, the Preserving Access to Manufactured Housing Act (H.R. 1779). Although the measure will not be formally approved until a recorded vote is taken, which is expected to occur the week of May 19th, the bill would amend the  Dodd Frank Wall Street Reform and Consumer Protection Act to change the criteria by which home loans are classified “high-cost” while keeping in place  strong consumer protections. The bipartisan bill is sponsored by Representatives Stephen Fincher (R-TN), Bennie Thompson (R-MS) and Gary Miller (R-CA), and has 113 co-sponsors in the House from both sides of the aisle.

The legislation would amend the thresholds by which designated small balance manufactured home loans  are classified as high cost under HOEPA while maintaining  the consumer protections from predatory lending practices under Dodd‐Frank. The measure would clarify that manufactured home salespersons cannot be considered loan originators unless they are paid by a lender or mortgage broker, a clarification without which lenders would likely be unwilling to finance manufactured home loans, making it difficult for low-to-moderate income borrowers to access financing. During the markup a number of representatives spoke in favor of the measure including Financial Services Committee Chairman Jeb Hensarling and ranking member Rep. Maxine Waters (D-CA) who indicated she would support the bill despite lingering concerns.

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Legislator asks to Delay New Mortgage Rules

October 25th, 2013 1 comment

Representative Shelley Moore Capito (R-WV), who serves as Chairman of the House Financial Services Subcommittee on Financial Institutions and Consumer Credit, is garnering support to encourage Consumer Financial Protection Bureau (CFPB) Director Richard Cordray to postpone implementation of the new mortgage rules set to take effect in Jan. 2014, until Jan. 1, 2015. Noting financial institutions have 4,000 pages of new regulations to pore over, she says some smaller firms may only have one or two compliance officers, making it especially difficult for them to be in full compliance by the deadline. Included in the delay would be the HOEPA High Cost Mortgage Rules that impact manufactured housing. According to the Manufactured Housing Institute (MHI) newsletter to MHProNews, Cordray has made it known he does not want to forestall implementation of the mortgage rules.

(Image credit: HousingWire)