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Marty Lavin’s Views on Seattle Times-BuzzFeed Clayton Homes VMF-21st Controversy

January 15th, 2016 No comments

Phew! After reading the Seattle Times news article on Clayton Homes and Vanderbilt Mortgage, I am reminded of a scene in the movie, “No Country for Old Men.” In it, the deputy after viewing a horrific scene, says to the sheriff, “That’s quite a mess ain’t it, sheriff?And he replies, “If it ain’t, it’ll do till the mess gets here.

I also read Clayton’s response to the article and that sheds some light on the matter.

As an example, anyone with rudimentary loan knowledge knows well that just because a person who is of color makes $100,000 per year and pays a greater interest rate than a white making $35,000 per year, that of itself is not racist per se. Lenders look at demonstrated ability and desire to meet loan commitments, which are not locked to income. The better the payment record, the lower the rate. That is what drives the interest rate once loan qualification is determined.

The article surely knows this as it is hinted upon, but it destroys the tenor of the piece about racism and unethical and unlawful behavior by Clayton, if revealed.

I do not know Warren Buffett other than what I learn in the media. I have generally been very positive on Buffett, though I am taken aback by his support for a president with obviously anti-capitalist actions and leanings. But then I am reminded Berkshire-Hathaway has many companies that could be brought to their knees by IRS probes, EPA investigations, and the like by an unfriendly president. Further, government can do things to you and for you. Above all, I think Buffett has not only been smart, successful, and ethical, he is also a pragmatic soul. You can’t do what he has done without being highly pragmatic, so I give him a pass on Obama support. 

Now as to Kevin Clayton, I personally know him, like him and hold him in high regard.

I have a very hard time seeing the Kevin I know supporting some of the racist actions described in the account. While there are too many incidents to overlook, I do not believe the people I know at Clayton/Vanderbilt would initiate or condone the racist behavior alleged in the article.

If for no other reason, the folks at leadership there are flinty-eyed businessmen, and they know that in today’s world a southern US company building and selling low-cost housing to many minorities and low income individuals will be rigorously regulated by government and the all-powerful non-profits. This is especially true when you are building and financing that old bugaboo, manufactured housing.

I do not sit in the Clayton/Vanderbilt board room. I have no “insider” take on this situation. My opinions hinge mostly on accounts in the media.

But I would offer this takeaway, were I to be asked. A company as large and important in its disliked industry as Clayton is, will be a target for strict compliance with every law and rule and if destruction can be brought about of the entity, so much the better. The rules being written by the CFPB and others are not only meant to regulate with ever moving targets, if it leads to business emasculation of the companies and the industry itself, few tears would be shed in DC and elsewhere. 

Some of the animus held against MH is deserved, and incidents as reported in the Seattle News story build on that animus. That is much of the tale here and the news account is prepared to report without revealing any details harmful to its tenor.

It does, however, leave unanswered the steps Clayton could take to create positive change in the organization. No matter how exaggerated the racist incidents regarding employees are in the news account, there certainly seems something is going on internally at Clayton/Vanderbilt. I’m not sure a mere denial is sufficient.

The employee to employee incidents of the type alleged must be ruthlessly quashed, little leeway given upon employee complaint, a quick internal investigation by experts at first complaint, and a quick decision based on the best information as to fault. Any superior allowing or contributing to such prohibited behavior gets one warning and fired upon the next, no matter who it is. This starts at the top and such behavior not only is illegal and wrong, it is poor business to allow it to happen, creating internal disharmony. It also leads to formal regulatory complaints no one wants to face.

Racist disrespect of customers or borrowers is even worse than employee to employee incidents. An employee has the option to leave a disrespectful business environment. A customer with a 20 year loan behind on their payments, struggling to meet them, needs to be handled firmly, but strictly within the law. Any collection supervisor allowing or suggesting disrespectful collection calls can not continue to allow such behavior from agents, and should it continue, warning and firing is the answer. Assuming Clayton is recording all calls with consumers, a sample listen-to of some calls daily will quickly reveal whether these allegations bear any truth.

Clayton is the wonder of the industry, wonderfully profitable in an industry little accustomed to such success. My 35 year familiarity with the organization has seen them as highly motivated, perhaps in the extreme, Kinda peeking out of the news account are people in an organization prepared to push the envelope to meet business goals or the keep their job, or even to avoid ridicule or censure.

Don’t get me wrong, I am a strong believer in firm performance requirements for associates, with rewards for successful performance, dislike of failure, with training and guidance to correct poor performance, ended by firing for continued lack of success or effort. But one senses the pressure to succeed seems to be driving some people to violate company procedures to reach their goals, even though the associate probably knows it is acting improperly. That’s too much pressure.

With the animus directed at manufactured housing by the media, government, the non-profits and regulatory statutory edicts, its dangerous to tread too close to news accounts like this. This can lead to the drip-drip-drip of continued news accounts, more regulation, more charges and the severe impairment of a company. Who wants to get to work with a rabble of protestors marching in front of the Maryville office with “Clayton Loans Matter” signs? 

Now that the media is chasing Buffett for answers, my fear has been that he would be so hounded defending Clayton, that at some point the $500 million in annual profits might seem like insufficient returns. I’m not sure that will happen or that it would have negative consequences for the manufactured housing industry, but I fear it could. ##


MartyLavin-JD-Attorney-ExpertWitnessManufacturedHousing-IndustryVoices-MHProNewsMARTIN V (Marty) LAVIN
350 Main Street
BURLINGTON, VT 05401
att’y, consultant, & expert witness
only in factory built housing

(Editor’s Notes: The above was first submitted in late December, and excerpts were quoted in the MHLivingNews report, linked below.

http://manufacturedhomelivingnews.com/lies-advocacy-journalism-and-statistics-seattle-timesbuzzfeed-attacks-warren-buffetts-clayton-homes-defends-charges-of-racism-and-discrimination-critical-analysis/

Some of the commentary by Marty Lavin that was not originally used – notably the notion that Warren Buffett might find the headache of manufactured housing too much to stomach, and then he may be inclined to spin them off from the Berkshire-Hathaway family of firms – was deemed in the editor’s judgment not necessary for the critique of Mike Baker and Daniel Wagner’s slanted report.

That said, since The Motley Fool has recently published an analysis that may be problematic in places, nevertheless it comes to a similar conclusion that Marty Lavin did days before. Namely, that $577 million in profits from Clayton Homes may not seem enough for Warren Buffett to want to retain MH firms in Berkshire-Hathaway.

MH Industry insiders may recall that Buffett spun off the MHC components of Clayton Homes after they purchased the vertically integrated company.

The Masthead Blog on MHProNews has drawn attention to MHI’s lack of response to the PBS NewsHour report, and to the Clayton Homes drama too. This was done after a source connected with MHI suggested to MHProNews that ‘five figures’ was spent by the association in the direct costs associated with the PBS NewsHour interview.

http://mhpronews.com/blogs/tonykovach/2016-louisville-show-previews-updates-on-media-clayton-homes-drama/

Note that top MHI staff, when asked by MHProNews about the amount of money spent on the reputation and media management consultants and the related PBS interview costs, declined to answer.

MHProNews again wishes to encourage MHI to speak out publicly on at least the PBS related negative media.

It should be noted that while many in the industry – from firms of all sizes and from state associations – are reluctant to speak out on these issues publicly, there has been a steady stream of private ‘thank you’ messages and calls to MHProNews and MHLivingNews for our leadership in presenting a more accurate and balanced view of The Seattle Times and PBS NewsHour takedown reports.

http://manufacturedhomelivingnews.com/what-pbs-newshour-missed-about-manufactured-home-living/

It should also be noted that Isbhel Dickens/NMHOA declined a public debate on the issues raised from the PBS NewsHour, and that Dickens linked the PBS and Seattle Times/BuzzFeed reports. The download of Dicken’s message, is found on the article linked here. It is insightful reading for a serious researcher on these issues, as it clearly suggests that this bad media blitz is all about the politics of HR 650/S 682.

Given that some Democrats are now calling on an investigation of Clayton Homes and their related lenders in the wake of this,

http://www.mhpronews.com/blogs/daily-business-news/democratic-lawmakers-want-doj-to-investigate-clayton-homes-lenders-in-wake-of-seattle-timesbuzzfeed-report/

it seemed timely to revisit Marty’s original replies, posted above. Marty Lavin agreed.

MartyLavin-JD-Attorney-ExpertWitnessManufacturedHousing-postedMHProNews-com-_001

Thoughtful industry comments on this topic or others, is welcome.) FYI, the full-sized version of the recent photo with Marty – is at the right. Updated with these pics at Marty’s request, so others can see just how terrific he looks wrapped inside that grand ship he and his bride Pat/Ava share, berthed at upscale Miama Beach. ###

marty-lavin-jd-manufactured-home-community-owner-on-board-spy-sea-2-22-2104

Marty Lavin on board the rear deck of their custom 70′ Italian ship, the Spy Sea, Miama Beach, FL.

Reaping the Consequences from the Past…the Outcome is no surprise

December 17th, 2015 No comments

As you can imagine, I am hardly surprised (that MH failed to get S 682/HR 650) included in the Congressional Omnibus Appropriations bill, and failed to get chattel lending okayed by FHFA with the GSEs).

This industry ran roughshod over consumers for many years. Too many LLC (land lease community) owners acted as dictators. Millions of people losing their homes, and the litany continues.

The good the industry has achieved was insufficient to balance the past damage. As those in power watched these results, an ingrained animus arose which may well be resistant to be overcome, and it colors every decision regarding MH. That puts our supports at a constantly defensive position.

That does and will continue to dog the industry,  getting help from on high will be ever-difficult,  no matter how needed and logical. 
I’m not sure there is any easy cure to our dilemma, but staying the course on good product, superior consumer treatment, and building value can be the only logical course.

Politicians may help, but their help is uncertain and unreliable. As we saw with DTS (Duty to Serve, part of the HERA 2008 bill), passing a law hardly forces the matter to happen. Bureaucrats, commissions and boards are the true powers. They have not been with us. ##

marty-lavin-50-posted-mhpronews-com-industry-voices-blogMARTIN V. (Marty) LAVIN
att’y, consultant, and expert witness
3
50 Main Street
BURLINGTON, VT 05401

winter address: Nov-May
PO Box 545927
MIAMI BEACH, FL 33154

(Editor’s Note: the parenthetical statements abvoe are not in the original, but were edited in to make clear this expert’s statements, which are otherwise faithfully reflected as sent to us for publication. Headlines are typically supplied by the editor, as is the case in this OpEd too.  Please note that Marty Lavin, JD, took a strong, pro-HR 650/S 682 stand via video, see that, linked here.  Marty worked with one of the GSE’s for years, learn more about that in the same video previously linked.

Other comments on the failure to get Preserving Access included in the Congressional omnibus appropriations bill have come in, a sampling off the record comments, linked here, and on the record thoughts from Triad’s CEO, Don Glisson Jr, linked here.)

About Missing Passage of Preserving Access

December 16th, 2015 No comments

The word is out.  The MHI backed bill won’t be included in the omnibus appropriations package that will be passed soon. My view is that the Preserving Access  bill never had a prayer anyway, as President Obama would have vetoed it, as he has made it clear that he won’t allow ANY changes to Dodd-Frank.  That shows just how disconnected he and his administration are from the real world. Getting Congress to add it to the appropriations bill would have been nice window-dressing, but it was otherwise never going to see the light of day.

Personally, I am not surprised by FHFA excluding chattel. The GSEs clearly never wanted to do chattel loans, and even if they added chattel, I believe they would make it so restrictive that it wouldn’t amount to much volume. The industry wanted FHA Title I chattel opened back up several years ago, and when it finally did get reopened, it wasn’t much of a program and is barely used. IF the FHFA allows chattel, my prediction is it will end up like the FHA Title I program with limited use and limited benefit to the industry. 

On a side note, I have seen articles written about ‘back room’ meetings with finance company and industry leaders occurring with the FHFA. As the leader of the second largest lender in the industry, I have not been given any briefing about this if it happened, and I certainly wasn’t invited if the meetings did take place. But then again, I have not been consulted by anyone at MHI for several years on anything, so maybe I’m just out of the loop. 

And once again, I will state that not having MHI and MHARR working together on issues like these is a travesty, and the lack of a unified voice makes it easy for the bureaucrats in DC to turn their back on us. 

Why we can’t pool our efforts and resources and present a cohesive and defensible plan on no-brainer issues like these that benefit the ENTIRE industry is beyond me. 

DonGlissonJrCEOTriadFinancial-postedIndustryVoicesMHProNews-Don Glisson Jr.
Chief Executive Officer
Triad Financial Services, Inc.
4336 Pablo Oaks Court
Jacksonville, FL. 32224

 

(Editor’s Note: Extensive commentary on these issues is found in the interview, Another Cup of Coffee with...Don Glisson, Jr., linked here.)

One Click, One Minute For More MH Lending

December 7th, 2015 No comments

THIS IS VERY IMPORTANT.

Over the next couple of days, the Senate and House will be completing work on an omnibus appropriation bill. We need you to contact your Congressperson and Senators TODAY to ask them to urge them to put the provisions of H.R. 650/S. 682 into an omnibus appropriation bill.

This takes ONE CLICK HERE.

If the link does not work, here is the URL to copy into the address bar of your browser: http://cqrcengage.com/mhi/app/write-a-letter?0&engagementId=140794

One click. One minute of your time. 

Thanks for all you do in support of the industry. ##

tyler-craddock-exacutive-director-VirginaManufacturedModularHomeAssociation-VAMMA-postedMHProNews-com-Tyler Craddock
Executive Director
Virginia Manufactured and Modular Housing Association (VAMMA)

 

Editor’s Note: Other letters on Preserving Access to Manufactured Housing are found linked below

More Manufactured Home Loans Means More Homes Sold in 2016

Crossing the Finish Line in DC is up to YOU!

 

More Manufactured Home Loans Means More Homes Sold in 2016

December 7th, 2015 No comments

We’ve been talking about getting some relief from the Dodd–Frank law. We have an opportunity to get that done this year. The situation is that we getting very close to final decisions being made about what policy material will be included in the very large omnibus appropriations bill. It’s literally all the appropriations bills rolled into one bill. There will be winners and losers in this process. Not every policy matter that interest groups want will be included in the bill.

The winners will be those who want it the most. Do you really want some reform this year? Do you want more lending for 2016?  If so, please contact your House member and two Senators.

We can’t presume they will help us. Even if they have indicated support, we have to keep reminding them. It’s a mad house there as Congress tries to close out business for the year.

Take a couple of minutes today – not tomorrow, or some day soon – to click on the link below.

This link is MHI’s system to contact your two Senators and your House members. It’s really easy and quick.

Let’s do it now!

Thanks,

Joe

P.S. We really need to win this year….conditions are always changing in Congress. We never know what the situation will be like in 2016. It’s an election year and bills will be harder to pass next year!

joe-kelley-iowa-manufactured-housing-association-industry-voices-mhpronews-com-1Joe Kelly

Iowa Manufactured Housing Association

 

(Editor’s note, please see Ross Kinzler’s OpEd on this same topic at this link.)

Crossing the Finish Line in DC is up to YOU!

December 7th, 2015 No comments

In the next 10 days, the industry has a chance to turn around its fortunes regarding financing.  Step 1 is to pass S 682, the Preserving Access to Manufactured Housing Act.  It’s companion bill, HR 650 has already passed the House on a bi-partisan vote.  In the Senate, there is no chance for our bill to pass as a standalone bill because it will be vetoed.  If however, it is attached to an appropriations bill that must pass, the President will have no choice but to sign it. 

Let me say that again, if S 682 is passed as part of an appropriations bill, the President will sign it.

We need industry members to press for S 682 to be attached as a so-called policy rider.  This is a normal process for getting legislation passed at the end of a session.

Please Call or Fax Your Senators.

Here is the message: 

1. We need S 682, the Preserving Access to Manufactured Housing Act, added as a policy rider to the Banking Appropriations Bill.

2. The bill HR 650 passed the House on a bi-partisan basis.

3. The bill addresses the overreach of the CFPB in applying Dodd-Frank to manufactured housing in a way it doesn’t apply it to real estate agents. ##

RossKinzlerWisconsinHousingAllianceExecutiveDirector-IndustryVoicesblogManufacturedHousingProfessionalnews-MHProNews-comRoss Kinzler
Executive Director
Wisconsin Housing Alliance

(Editor’s Note: MHProNews supports this bill and our publisher has personally contacted his Senators and Congressional Representative, as Ross Kinzler suggests. Joe Kelly’s OpEd on this same topic, is linked here.

For those who want more information, see Lesli Gooch’s column this month, linked here. Ross and Joe are correct, just take 5 now, and let’s get this done.)

Could Long-Term Home-Only Mortgage Loans in Land Lease Communities Rise Again?

December 7th, 2015 No comments

I read with great interest Paul Bradley’s recent article in MHProNews. I agree with Paul that there is an opportunity forthcoming to bring back a program that was created by Freddie Mac – one of the two (2) Government Sponsored Enterprises (GSE’s) – in the early 2000’s. That program had Freddie providing conventional, residential home-only mortgage loans at market rates in selected Land Lease Communities where the residents had a long-term lease.

I was one of a very small group of professionals involved in the manufactured housing industry who worked directly with Feddie Mac to create that program. I know firsthand how well the program worked for residents in three (3) land lease communities that we owned when the program was active.

This was not a simple program to get out of the starting gate. It took well over two (2) years to draft the program, garner internal agency approvals, work through the idiosyncrasies, deal with legal and appraisal issues and partner with a lender to finally bring the program to the market. All of the work involved was not easy to accomplish, yet in the end the program became a reality. And, in my opinion, the program was a success.

People will question why the Freddie program was a success, even though it was not available for more than a few short years. There are many reasons why the program ultimately was cut short by Freddie Mac, but now is not the time to rehash those issues.

What is important is to look at the successes of the program. The template and performance are set for the GSE’s to use, so that time is saved. The success is proven by the number of performing, conventional long-term mortgage loans originated in land lease communities at then current market rates.

As stated above, our firm utilized this lending program in three communities. The home buyers were thrilled to have this loan option available. In fact, after we began to offer the program, rates dropped significantly. Almost every borrower refinanced their loan at a lower interest rate without any issues or penalties!

With complex programs come many questions and concerns. Let me focus on two important issues.

First, under the Freddie Mac program, the mortgages on the homes did not impact the underlining financing of the land lease community. This was a critical issue resolved early-on while we were drafting the program. Documentation was required and provided from the underlining land lease mortgage lender to Freddie Mac, assuring that the community lender would respect the long-term leases of the residents.

Secondly, there is no relationship between the Freddie Mac Program and the proposal by the Uniform Law Commission to title the manufactured homes as “real property.”  Although there were various phrases and terminology utilized in the Freddie Mac program, there is zero connection to the ULC proposal, which is important, as the ULC plan gives current MH personal property lenders heartburn for a variety of reasons.

According to MHI and others, the Federal Housing Finance Authority (FHFA) will soon issue a draft Duty to Serve rule. It could be a great opportunity for manufactured home lending if one of the recommendations suggests a lending program similar to the Freddie Mac pilot. Having another viable lending option would be a positive step in the market place.

I stand ready to work with the parties involved on this or any other lending option once the FHFA rules are known. Feel free to contact me, indicating your interest or support. ##

rick-rand-great-value-homes-manufactured-home-pro-news-industry-voices-guestblogRichard J. “Rick” Rand
President
Great Value Homes, Inc.

9458 N. Fairway Drive
Milwaukee, WI 53217-1321

414-352-3855

414-352-3631 (fax)

414-870-9000 (cell)

RickRand@gvhinc.net

Calling MH Innovators . . . Let’s be realistic about Duty to Serve and get something done to bring Home-Only Loans to our Manufactured Home Communities

December 4th, 2015 No comments

The Federal Housing Finance Authority (FHFA) will soon issue a draft Duty to Serve (DTS) rule. The final rule that follows the brief comment period will tell Freddie Mac and Fannie Mae what the two Government Sponsored Enterprises (GSEs) will have to do in terms of providing loans to consumers for manufactured homes (MH). The ruling will influence things for as long as the two GSEs are in fact government-sponsored, which I bet will be a very long time.

Everyone involved in the land-lease community (LLC) sector wants there to be more chattel lenders. Clearly, a healthy housing sector cannot rely on just three national lenders and a bunch of captives.

Will DTS add the GSEs to this short list of chattel lenders?

The short answer is no. The FHFA will not require the GSEs to start financing chattel MH loans.

There are three very basic political realities that make calls for GSE chattel lending entirely hollow:

  1. The GSEs will do everything possible to not add chattel lending to their products list. They were burned in the late 90s by large pools of chattel MH loans and they still remember it.
  1. The FHFA won’t make them. The FHFA has both a “safety and soundness” responsibility for GSE oversight and a Duty to Serve mandate. Under safety and soundness, the FHFA will not require the GSEs to incorporate chattel based solely upon the record of chattel loan performance.
  1. Industry and consumer groups are not working together to create any real pressure though they’re not far apart from my read of things. That said, even together they probably couldn’t overturn factors 1 and 2.

I note #3 because it’s been my experience that lawmakers and regulators don’t like being in the position of settling debates between opposing parties. When faced with that sort of disagreement, regulators will, whenever possible, choose deferral and non-action.

Before you get caught up in the inevitable diatribe that will follow the draft DTS rule, consider an alternative based upon an opening that I expect we will see in the rule.

I expect the FHFA will look at bringing back a pilot program that Freddie Mac and some well-known industry leaders implemented in early 2000’s. Specifically, that program had Freddie providing conventional residential home only mortgage loans in LLCs where there was a long-term lease.

Don’t say it can’t be done. It’s been done. I and the other LLC owners who spearheaded the program with Freddie Mac have done it. Home only mortgages that don’t compromise the underlying land (the LLC) or your ability to finance or sell the LLC. But, they do make conventional rates and terms available in communities possible.

How would buyers of homes in your LLC respond to a bank making conventional residential home loans in your community? Could you sell more homes on vacant sites if lender would do 10% down-payment and 30-year fixed rate financing?

Such a program would require long-term leases because conventional lenders won’t lend long-term on a home that doesn’t have a long-term lease. I know of community owners with 20 year leases today so this isn’t too much of stretch, really.

And, don’t be confused with the term mortgage. Yes, the home would be titled as real estate and the security interest would be a mortgage on the home only. The titling of the home and the mortgage instrument don’t include the land and don’t interfere with your commercial mortgage. This type of lending has been done in a range of leasehold arrangements. It works.

Understandably, not all “parks” would make the trade-off. But, higher-end LLCs where the highest and best use is a LLC and where the homes are relatively expensive, conventional loan rates would be a significant benefit to both buyers and LLC owners. It’s a different value proposition and a different public image than a “park”, indeed.

But, for those who are interested, let’s pull together and urge the FHFA to keep or include home only mortgage lending in LLCs in the final rule. Let’s make sure the GSEs know that there’s interest in using home only mortgages in some LLCs.

What we can’t have is a chorus in unison saying, “Make them do chattel!” That’s the equivalent of spitting into the wind. Join the chorus if you want more of the same, just cover your face.

The Duty to Serve is too important to squander. Drop me a line if you want to learn more and coordinate input to the FHFA’s draft rule when it gets released. It will happen fast, which is why I’m going public with my assessment of where we’ll be once the draft rule is published.

We as an industry need to let the FHFA and GSEs know that some innovators in the market want to find a solution to getting 4% home only mortgage loans in our communities. ##

PaulBradleyROCUSA-postedMHProNews-com-75x91-Paul Bradley, President, ROC USA.

 

 

(Editor’s Note: Paul Bradley is featured in a new video interview, see this link here.  As on any MH issue, we welcome confirming or other viewpoints.)

 

 

Why Potential New MH Lenders Hesitate Entering the MH Market – What MHCs can do to boost lending

December 2nd, 2015 No comments

Tony,
Shine your spotlight on this topic, please. 

Our firm made loans in a nice manufactured home community.  One of those home loans defaulted. 

ManufacturedHomeMHCtriestobuyfor10K

Other exterior views, and views of each interior room of the home was provided by the lender involved, including other public documentation and non-private evidence of their allegations.

We contacted the property manager when we repossessed it in November of 2014 and told her that we would like to leave the home there and we would pay them a 10% commission to sell it. She said, great we can move it quickly, especially since it’s in such good condition. (Older lady lived in it and died – see photos).

ManufacturedHomeMHCtriestobuyfor10K-left-Kitchen

Kitchen view 1.

ManufacturedHomeMHCtriestobuyfor10k-right-Kitchen

Kitchen view 2.

Our field rep made periodic calls and even explained our special rate that we would offer applicants on any of our firms repossessed homes. 

Anyway longer story short, that manager is gone. 

The field rep called on the new manager. This one now says the home will never sell, however “we will give you $10,000 for it.” NADA current value is $48,900. So we didn’t want to do sell for that 10k price, of course.

ManufacturedHomeMHCtriestobuyfor10K-partKitchenDining

Dining/Kitchen view 3.

Now we are getting threats for $5,700 in past due lot rent, though our agreement prohibited that. 

When will the community owners in your MH industry realize that there are reasons why so few lenders are left in MH? Sure, CFPB

ManufacturedHomeMHCtriestobuyfor10K-partKitchen

Dining kitchen view 4.

regulations are a negative factor. But another negative is the poor  professional behavior that flows from some, not all, manufactured home community owners and managers.

Please publish this, but withhold the names involved for now. Maybe, just maybe, that kind of community manager or owner will think about how embarrassing it would be if their names were published in connection with such short sighted behavior.

Thanks for all you do to advance MH. It’s a great industry, but some behave like it’s still the “trailer house” days. ##

ManufacturedHomeMHCtriestobuyfor10K-partMasterBath

One view of the master bath, other views and bedrooms looked equally clean and appealing.

(Editor’s Note: on occasion, MHProNews will publish letters-to-the-editor or OpEds sans the name and/or company who supplied it. That is done entirely at our discretion. But part of the rule of thumb we follow is this: is the person someone we know, and the item under discussion important and sensitive enough, to warrant publishing it anonymously? This letter fits all of those check boxes for us. The photos of the home shown were only part of the documentation provided to us by the sender of this lender.

As a consultant to the industry, and as an editor, I would agree with the writer on the following points: it is short sighted and costly to the firm involved and to the industry-at-large when a community operator or retailer tries to ‘steal’ a home from a lender.

ManufacturedHomeMHCtriestobuyfor10K-partMasterBath

Living room view, facing front door – as noted above – other views of this home, outside and inside, where equally clean and appealing. The most notable item that jumped out calling for attention was the wooden steps on the top photo, which can be a relatively low cost update or replacement item.

The successful exit of lenders (as well as home owners) from a home they own is a key component to protecting existing lenders, and encouraging new ones to enter into the MH lending space. The cost in terms of lost opportunities far outweighs the short term profit gained from ‘stealing’ a house.

We hope the upper management for the community in question will realize the error made, and will make good with this lender – treating them as a “partner,” rather than a “mark.” Should the lender opt to litigate this matter, we can foresee reporting that as news in the Daily Business News.

Final thought for now. For those considering lending on manufactured homes, there is documentation and processes that have successfully been put into place by MH lenders. “Park agreements” that cover such matters are part of that documentation. Most communities will honor the park agreements they enter into, and the current lenders all report being profitable. Even when U.S. Bank exited MH lending, they reported they were profitable – they pulled out of MH lending for other reasons, not due to a lack of profitability. We know a number of firms interested in entering the MH lending space, and a story like this should be a reason for dotting i’s and crossing t’s, as opposed to not making a move that can be a mutual victory to prospective lenders and their customers.

Other comments on this topic or related are welcome.)

The Fire Sprinklers and Manufactured Housing Debate – Two Views

November 5th, 2015 No comments

(Editor’s noteMHProNews.com/MHLivingNews.com: Let’s begin by stressing our respect for firefighters, Lorraine Carli, and the National Fire Prevention Association (NFPA).

One of our mottos states, “We Provide, You Decide.” © In that spirit, we welcome thoughtful commentary, differing or opposing views, such as the views expressed by Ms. Carli, below. We would concur from the outset to the fact that fire sprinklers save lives.

First, Ms. Carli, then the MHProNews reply.

Fire Sprinklers Save Lives

Dear Tony:
Thank you for the recent article by Jan Hollingsworth on fire safety in manufactured homes.  The 1976 Housing and Urban Development (HUD) standards have played a major role in the increased safety in these products.  We agree that working smoke alarms are essential.  Smoke alarms provide an early warning and more escape time.  They cannot, by themselves, control the fire or ensure escape.

Fire sprinklers provide another important level of protection.  This point was also made in NFPA’s 2013 report:  “The case for fire sprinklers is as strong for manufactured homes as it is for other one- or two-family homes.”  You note that many manufactured homes are in rural areas.  Rural communities tend to have volunteer fire departments that will take longer to respond to a fire.  Fire sprinklers can control a fire until the fire department arrives.

The comparison of fire experience post-HUD standard manufactured homes with other one- or two-family homes showed that the newer manufactured homes had a lower fire death rate per 100,000 properties.  However, the group of other one- or two-family homes includes many run-down homes.

Sprinklers save lives in all types of homes.  The most cost-effective time to install sprinklers is during original construction and installation.

Thank you for your consideration. For more information on sprinklers, please visit www.firesprinklerinitiative.org. ##

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Lorraine Carli, VP -NFPA.

Lorraine Carli
Vice President – Outreach and Advocacy
National Fire Protection Association
1 Batterymarch Park
Quincy, MA 02169
617-984-7276
617-840-4180 (mobile)
lcarli@nfpa.org

Why Many in the MH Industry Believe Fire Sprinklers Should Remain an Option, and Not Become Mandatory

  1. Ms. Carli’s response on behalf of the NFPA does not contradict a single point made in Jan Hollingsworth’s fire safety article, Keeping the Home Fires from Burning.
  2. No doubt, fire sprinklers can save lives. So can installing a fire department on every block — if local governments or citizens could afford them. The issues include balancing costs, mandates vs. providing consumers with the ability to make their own choices.
  3. As the article stated, a common concern is that rural locations and private wells often lack the water pressure to properly support fire sprinklers.
  4. Manufacturers offer sprinklers as options; consumers who want them, can get them.  That happens — rarely. As the article stated, an NAHB survey found that when consumers were given a hypothetical choice of a “free” fire sprinkler system or some other option, a large majority picked something else.
  5. The NAHB “Priced Out” report, quoted in the article, explains that hundreds of thousands would no longer be able to buy a manufactured home at all, if forced to pay for a fire sprinkler system. ##
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L. A. “Tony” Kovach, Publisher, MHProNews, MHLivingNews.com and industry consultant.

 

By L. A. ‘Tony’ Kovach. Email latonyk@gmail.com, ph. 863-213-4090.