Industry Voices

Dick Ernst Discusses Duty to Serve amidst the future of Fannie and Freddie and the potential return of private financing
Reporter Eric Miller with Publisher L.A. ‘Tony’ Kovach for MHMSM.com

We continue with the interview begun last week with Dick Ernst.

MHMSM: Even for Industry pros, there can be confusion with all the terminology, agencies, etc. Do you have a simple way or suggestion to help readers keep it all straight?

ERNST: I agree with the fact that it’s confusing. We’ve seen that recently in a couple of other blogs that were published. FHA is the Federal Housing Administration and it’s been around for years. The FHFA is the conservator for Fannie Mae and Freddie Mac and it was just recently put together to act as a conservator on behalf of the government. It deals only on the mortgage side of the business with Fannie and Freddie.

MHMSM: Will the FHFA go away when the future of Fannie Mae and Freddie Mac are determined?

ERNST: That is to be determined and I would expect that it probably would. I think it’s anybody’s guess right now. I don’t believe Washington really knows what’s going to happen to Fannie and Freddie; they still have huge issues and huge problems to work through. We’ve all seen the anticipated losses that the taxpayers are going to have to eat as a result of their involvement. I think there will be some privatization of that business, but the mortgaged-backed security market has to be alive and well and thriving. I think that there will be a continuing government role in some form of providing a marketplace, and it might focus on the low- to middle- and moderate-income families and affordable housing. That might be a better spot for them to play in. But it’s still too early to tell what’s going to happen to Fannie and Freddie and what role the government is going to play going forward, and whether FHFA continues to exist.

MHMSM: Any thoughts on the GSE’s Duty to Serve and how it can be enforced? Do you think the conservatorship excuse they have given holds water legally? If not, why not?

ERNST: There is a legal question and a practical question to be asked. Legally they are under an obligation, a legislative obligation, to create programs and it’s only enforceable to the extent that Congress is willing to hold their feet to the fire and say, “Look, you guys have an obligation to provide loan products to this industry because you’re only providing less than one percent of the financing that occurs when this segment of the housing market has historically averaged about 20 percent of the new single-family housing market. So it’s woefully underserved, and we passed legislation specifically for you to address it.”

That being said, the practical side of it is, who is going to put the pressure on it. Politically it could be suicidal because of the massive losses that Fannie and Freddie are taking. They would be saying “Oh, now we want you to go into this area of business even though there are some historical facts that this may have a higher default rate than what you are comfortable with.” I don’t think there’s many Congress people, including those on the housing finance committee, that really want to tackle this head on and hold Fannie and Freddie’s feet to the fire to say, “You’ve got to offer chattel financing, you’ve got to do this and you’ve got to do that.” There may be legislation there, but we’ve seen from a legal standpoint, obligations that the federal government has legislatively that they are just unwilling to address because of the potential political problems that exist for it.

MHMSM: Do you think that will be more palatable to address after they exit conservatorship, if that’s what happens?

ERNST: I think our industry is taking the right approach. We’ve always been big supporters of Fannie and Freddie, I guess in hope that they would step up to the plate and fill that Duty to Serve, and offer more programs and opportunities for a secondary market. We’ve made it clear to both agencies and the FHFA that the industry is willing to talk about skin in the game, talk about minimum credit qualities, talk about minimum equity requirements and have a good sustainable program. I don’t know that they’ve got the stomach at this point right now to take on something new. I think they’re overwhelmed with the size of the problems they have right now. That takes up the bulk of their time.

Once they’ve exited, I think we have to keep an open mind and say, “What is their obligation, what is their duty now to the housing industry, and what’s the role and how can we work within that?” I think the industry is taking the right approach to say, “Look, we’re not going to come out and say anything negatively against the agencies in terms of whether they should exist or not exist.” We continue to be hopeful that at some point it will provide us a source. We’re certainly not going to say anything about “take ‘em private and the government should get out of this business” because I think that it’s a marketplace the government has to play some role in; we just don’t know how big or how much.

MHMSM: What are some of the biggest barriers to providing chattel loan financing privately? How can the Industry move beyond some of the past history of experiences like Conseco?

ERNST: Right now there is no asset-backed securities market. Chattel financing, up until the credit crunch occurred, was predominantly either being funded by portfolio lenders, or the asset-backed securities market was still providing some. I’ve got to back up a little bit here. Clayton Homes’ Vanderbilt Mortgage and 21st Mortgage were both big players in the asset-backed securities market until the early 2000s; and then when the cost of securitization became so expensive, they felt their own existence being threatened because of the cost.

I can remember in the early 2000s where if someone had a billion dollars worth of securities to go to market, they wanted securitization for a billion dollars worth of manufactured housing loans, they had to come up with an additional 200 million dollars in over collateralization to get that deal done. There aren’t very many companies in this industry that could withstand that for any period of time because if you have to do that for two to three years, then all of a sudden, you’re talking about $600 million dollars in additional over collateralization, and a lot of companies didn’t have that kind of excess capital or excess assets.

The landscape changed dramatically for our industry after the blow-up, if you will, of the sub-prime credit purchases that we were doing in the mid to late 1990s, and I think it’s changed pretty dramatically, and I really don’t see it getting back to where it was. I think the asset-backed securities market will come back, but I think the disciplines many lenders have in their portfolio will open up an opportunity to do some securitizations, because the credit quality is so high and the default experience has been very good on that higher-credit-quality customer.

MHMSM: Will there be a process and what will the process be for public finance returning as an option?

ERNST: The process is a comfort level in the capital markets. I’m sure you’ve read where there’s beginning to be some opening up in the mortgage-backed securities market as well as some asset-backed securities classes like automobiles and other things like that, where there are some asset-backed securities deals being done. Slowly I think, because of demand or the need to invest capital, I think that ultimately there will be that opportunity to do some asset-backed securities with some pretty high-quality manufactured housing loans. Some of the more recent loans that were securitized by Countryplace Mortgage and Origin, some of those had average FICO scores of more than 700. It was pretty high-quality and for the most part, those have performed very well. I think it’s a matter of investor confidence and sitting on a lot of extra capital right now that they need to get invested; but they want to invest it in something that’s going to have predictable returns and a predictable experience.

MHMSM: The manufactured housing industry experienced an easy-money, no-credit-score bubble in the late 1990s. That was repeated more recently in the site-built housing industry. Have we learned our lessons? What are those lessons?

ERNST: Who do you mean by “we”? If you’re talking about the manufactured housing industry, I’d say absolutely we’ve learned our lesson. I think there’s been a lot of slicing and dicing, so to speak, of that business that was purchased prior to 2000 or 2001; and a lot of people looking at the credit quality look at the way business was being done back then.I mean, we got pretty loosey-goosey back in the late ’90; and when I say loosey-goosey, it’s been reported Marty Lavin (who is kind of a statistical nut and likes to look back at things) has indicated that more than a third of the businesses purchased in the late 90s had less than 600 FICO score business.

We know, based on experience now, that that business cannot perform. It’s not a matter of IF it’s going to repossess; it’s a matter of WHEN it’s going to repossess. When you’re dealing with low- to moderate-income customers, they have less leeway to be able to withstand an adverse event in their life, whether it’s an income interruption or whatever it may be; they have fewer assets, fewer reserves and less disposable income to withstand that event. I think we’ve learned.

The survivors do a lot of verifications now: they verify down payments, they verify income, they verify employment, they look very carefully at what the customer’s disposable income is going to be, what their other expenses are, what their family size is – all of those things now, I think, are being looked at a lot more closely. I think that the lower-quality credit customers are just not able to get those loans financed for the most part. If they do, through a company like 21st Mortgage, they’re going to have to have some significant equity in that loan or put up some collateral, perhaps land that they own or something like that, so they have more at risk. I think our industry has learned a lesson.

I can’t speak for the site-built industry. It’s been pretty devastating what’s happened to them. You’d like to think that everyone learns a significant lesson from this, but we all know there are a lot of cyclical events that occur in major markets like this, and we can only hope that everybody has learned a lesson.

MHMSM: What are your thoughts on efforts like Ken Rishel’s to move chattel ahead via establishing captive finance programs, especially for land lease community operators?

ERNST: I think the captive finance entities that Ken works with and a number of community operators that provide financing for their own customers is absolutely through necessity. You have to remember that land-lease communities have two potential benefits. Number one is, they tend not to focus so much on the profitability on the sale of the house. They want it to be profitable to some extent, but there’s less emphasis on the profitability and they want to have a loan that they can put in their portfolio. They’re willing to take a little bit more credit risk because they have much more control of that individual transaction with the site manager who can monitor what that customer is doing on a monthly basis and look for the signs that they may be having some issues; maybe look out there and see that the guy bought a new motorcycle or whatever it may be. Sometimes those can be things that create difficulty with a loan going forward. I think the captives are by necessity.

At the same time I think the captives in the future – and I don’t know how long in the future – but I think at some point in the future, there will be the ability to securitize those loans with someone with some pretty high leverage, or I should say low leverage. In other words, if you put a billion dollars in loans together, you might be able to re-coupe a half a billion dollars in capital. In other words, you might have to do a two-for-one type of deal because of the potential risk involved. Now, the larger communities – and to the extent they are well capitalized and have access to capital – I think you see folks like Hometown America and others who have done that and done it successfully, believe it’s necessary for their business model to support the communities, to create revenue-generating customers, revenue from those lots that they lease, and they think it’s important. At the same time, they’d love to be able to securitize those loans so that they don’t have all that capital tied up.

I think it’s going to continue; and the numbers that have been published – I have seen both from George Allen and others, and Tony’s numbers – indicate anywhere from three and a half billion to as much as six or seven billion dollars worth of paper that’s being held by these community owners. I do think the SAFE Act is going to cause everybody take a look at that and make sure they are doing business the right way; but at the same time, the captives are a necessary part of their business model.

Be sure to catch the third part of the MHMSM.com exclusive report with Dick Ernst when we discuss the SAFE Act and its impact on the Manufactured Housing industry and the extent of a potential boost from FHA financing.

Click for Part Three of this interview

MHARR VIEWPOINT – AUGUST 2010
By Danny D. Ghorbani

The first step in solving a problem — any problem — is admitting to yourself that there is a problem, that the problem is real and that it exists. The second step, and perhaps the most difficult, is to accurately assess and define the problem, so that one or more potential solutions can be considered, weighed and, ultimately, implemented.

By any objective measure, the HUD Code manufactured housing industry has a problem. Over more than ten years, production and sales have plummeted. From a modern high of more than 373,000 homes in 1998, production in 2009 fell to below 50,000 homes. The trend in the statistics, moreover, has been steadily downward, and appears — over the long-term — to transcend both positive and negative changes in the broader economy and the broader housing market. No amount of happy talk or glad-handing can paper over this fundamental fact — the status quo for the industry and its consumers is unacceptable, and must be changed.

But that is the easy part. The more difficult part is defining the problem as an avenue to arriving at solution(s) that will work. To start, we can identify what is not a problem — and that is our relations, as an industry, with Congress and the lawmakers in Washington, D.C., who pass the laws that govern our comprehensive regulation by HUD and the finance programs and entities that impact the ability of lower and moderate-income Americans to purchase industry products that they can afford without costly subsidies.

The track record of the industry and its representation in Washington, D.C. within this realm is quite good, and the reason is very simple — manufactured housing and the manufactured housing industry are favored by legislators in Congress. And for good reason. The industry provides jobs that will stay here in America, without outsourcing. The jobs that the industry provides are well-paying manufacturing jobs, typically located in the heartland of the country, where the success or failure of the broader economy is largely determined. The industry, moreover, produces homes that provide affordable home-ownership for American families at all income levels without tax-funded subsidies. The industry, therefore, provides a vital resource — affordable home-ownership — without asking for tax dollars, only parity with other types of housing in various government housing programs, such as FHA programs.

So, Congress has been good to the industry. In 2000, it passed the Manufactured Housing Improvement Act, to take manufactured housing into the 21st century and complete its legal and policy transition to the legitimate housing. In 2008, aware of the trouble that consumers were having with financing, Congress included two critical manufactured housing provisions in the Housing and Economic Recovery Act of 2008 (HERA) — the “duty to serve underserved markets,” designed to expand and improve private financing and end discrimination against manufactured housing by the Government Sponsored Enterprises (GSEs), and FHA Title I and Title II improvements, designed to expand and improve public financing for manufactured homes financed as chattel, real estate and as part of land-home packages.

These are all good laws, designed to promote the availability and use of affordable manufactured homes. These laws should have fostered an industry boom in the solid national economy of the years following 2000 — with an industry expansion involving hundreds of thousands of homes — and should be helping to foster an industry revival now, in a post-recession economy. At least that was the hope — and the theory. But, things have gone wrong, and therein lies the problem.

The problem is that none of these good laws are being implemented in the way that Congress wanted, and expected. The 2000 reform law has been gutted by HUD regulators and attorneys. There is no — and has been — no appointed program Administrator for most of the past ten years. Enhanced preemption has never been implemented. The MHCC — the real centerpiece of the 2000 law — is being turned into another rubber-stamp “advisory council.” Its proceedings have been taken over by program regulators and a large chunk of its authority was taken away when HUD — without any public comment — read catchall section 604(b)(6) out of the law, which required HUD to bring enforcement policy and practice changes to the Committee.

HERA-based FHA Title I improvements have fared no better. Inexplicably delayed for years, those improvements are now finally being implemented, but their impact appears likely to be minimized by recently announced Ginnie Mae requirements for the securitization of new Title I loans ($10 million minimum adjusted net worth plus 10% of outstanding manufactured housing mortgage-backed securities) that will severely restrict access to the program by the new lenders that will be needed to appreciably increase the availability and number of manufactured housing loans for consumers.

Similarly, the proposed rule to implement DTS published on June 7, 2010, represents a major disconnect with the intent and objectives of Congress that, if implemented, will predictably fall well short in helping to end the discrimination against manufactured homes by the GSEs, that lies at the root of the current near-unavailability of manufactured home financing.

Despite good relations with Congress, then, and good laws passed for the benefit of the industry and its consumers, the results have not matched expectations. The implementation of each of these laws, by relevant federal agencies, has not come even close to what Congress wanted. And in certain respects, these agencies are openly defying clear congressional directives.

The pattern, therefore, is clear. Congress tries to help the industry and, then … nothing — or close to nothing or, sometimes, worse than nothing. For an industry that is comprehensively regulated by the federal government and, thus, thrives or declines based on decisions made in Washington, D.C., this is — and has been — a prescription for trouble. As an industry, we have an obligation, to ourselves and to our consumers, to question — to ask why this is happening, and how it can be fixed before much of the industry falls by the wayside, leaving only a handful of survivors. MHARR is asked constantly why the industry is so impotent in Washington, D.C. in the face of continual resistance by regulators and other administrative types to the proper implementation of the good laws that Congress provides us. MHARR , in response, has studied this issue, going back over the history of the industry’s presence and involvement in Washington, D.C., dating back to the start of federal regulation, to find workable solutions, and will share its findings and suggestions in the September 2010 MHARR Viewpoint.

In MHARR’s view, the industry’s inability to implement critical laws despite strong Congressional support lies at the core of the industry’s difficulties, and needs to be addressed decisively.

MHARR is a Washington D.C.-based national trade association representing the views and interests of federally-regulated manufactured housing.

Reporter Eric Miller with Publisher L.A. ‘Tony’ Kovach for MHMSM.com

MHMSM: To help us set the stage for this interview, please tell us about your role at Finmark and how you and your firm serve the Manufactured Housing Industry.

ERNST: Finmark is a shortened version of Financial Marketing Associates. It’s a company I formed in 1983. When I first got into the manufactured housing industry and I started my own company, we represented banks and savings-and-loans and originated manufactured housing loans for them. Eventually, it’s evolved into my doing consulting work predominantly now, and putting together outside-the-box type transactions.

Some of the unique things I have done are a joint venture mortgage operation between three manufacturers and Wells-Fargo, and ran that operation for about three years. I also put together Countryplace Mortgage for Palm Harbor Homes 14 or 15 years ago now. I helped Textron create a commercial construction mortgage loan program and was working on a consumer program for them when the financial meltdown occurred and they decided not to move forward with it, and ultimately decided to get out of the manufactured housing inventory finance business as well.

The work I do is all related to the manufactured housing business. I like to put special deals together and provide consulting to manufacturers, retailing groups or finance entities that makes their projects possible.

MHMSM: What is the “big picture” to take away from the June 2nd Elkhart meeting?

ERNST: Many times the big picture gets missed based on individual comments and interpretations of how the meeting went. There are a couple of big picture take-aways from that meeting. One is, I found Dave Stevens, the FHA Commissioner, and members of his staff to be very open and candid about their willingness to work with the industry and help craft a program that can be sustained. I don’t think there’s any question that the FHA believes clearly that manufactured housing has a very important role to play in providing affordable housing to people in this country.

The issue that they have to deal with – and I think this goes beyond manufactured housing – is they have a very difficult task of reigning in the FHA mission of being the lender of last resort for low-end, low-quality credit customers to being a viable source of financing for qualified customers. They may run a broader spectrum than what Fannie Mae and Freddie Mac have done, but I really believe they want to play a serious role with Ginnie Mae to provide a good source of FHA insurance and have Ginnie Mae provide that secondary market for our industry.

I think we have some very smart people with extensive mortgage backgrounds willing to sit down, engage with us, understand our business better and work with us to craft a program that’s going to be sustainable.

The other take-away is that FHFA now is the only entity that we’re able to talk to with respect to Fannie and Freddie. It’s clear to me that they are using their conservatorship as another convenient excuse not to tackle something they have been directed to do through the Duty to Serve legislation. They are using their conservatorship and all of the other problems that they have in order to pretty much stay away from our industry. That’s a sad situation.

MHMSM: What is the big picture take-away from the follow-up at the MHI Summer Meeting with Vicki Bott [Deputy Assistant Secretary HUD] and other Industry and public officials?

ERNST: The Washington meeting came about as a result of FHA reaching out and saying we would like to put together a working group of lenders and interested parties who can help us understand your business – the way you originate it, the way you service it, the repossession and disposal characteristics – and understand your business better so we can address those things properly and still have a sustainable program.

Vicki mentioned that at some point in the not-too-distant future. they’re going to be sending out a TI letter to all mortgage lenders that are operating in the FHA space that anything below a 580 FICO score is going to require a ten percent down payment. That’s a huge jump for FHA because the current regulations require it to be anything below a 500 FICO score. From 500 to 580 – that should be a clear message that FHA is taking these defaults and delinquencies very seriously and they really believe they have to pay a lot more attention to the underwriting side of the business instead of being the lender of last resort.

Again, the take-away from that meeting is she came prepared. She brought several members of her staff. I wasn’t really expecting that. I thought there would maybe be one or two people, but she brought in four or five people including her head appraiser, because there can be appraisal issues and concerns about the program. They had specific questions in areas that they wanted to explore and get feedback from the industry.

I was very pleased with the quality of the meeting, the quality of the questions, the openness of our membership, the lenders who were involved and I’ve seen in some previous blogs comments that the people around the table were “the survivors” – and there is a lot of truth in that. The survivors weren’t the guys doing the bad acting in the late 90s that created some of the housing problems we had in the early 2000s.

I appreciated their candor. For the first time ever, when Bob Ryan, their risk officer… I mean that in itself has got to be amazing to people who track FHA. FHA has a risk officer. That’s pretty astounding to know that with billions and billions of dollars in mortgages that they’re insuring, and they’ve never had a risk officer before to assess what type of risk they are taking on and whether or not programs for site-built are sustainable as well. So when they came to us and said not only are you battling some perception issues, you’re also battling some real issues.

When provided some material on FHA Title II that the serious delinquent accounts, the number of defaults, 30, 60 or 90 day delinquents, all pretty much doubled the site-built business – the rates were double what the site-built business was, that’s a real problem. And it’s a problem our industry has to respond to and say we do need to tweak this program and make it actuarially sound and there are things both of us can do to make it work.

MHMSM: Vicki Bott comes to HUD with a Mortgage Background, Right?

ERNST: That’s correct. She came from Wells Fargo. She’s a very bright lady with a very inquisitive mind. The interaction I saw with her is “she gets it.” When someone responds to her, we’ve seen others that pretended they got it, but they didn’t really have much of a clue what we were talking about. I think that she really gets it from the depth of experience she has from her mortgage background.

MHMSM: If I’m just an average voter out there, I might listen to this and say if you have the qualified borrowers, why can’t the private market handle them? Doesn’t all this stuff exist because we want to allow people who maybe aren’t as qualified to have a home?

ERNST: I don’t think that’s it. It’s potentially a conflict and the way the FHA conventionally has been viewed as providing the opportunity for someone to get a home who wouldn’t otherwise qualify for a conventional program.

But I think you do that in a couple of different ways. The conventional programs from Fannie and Freddie, and even those from private institutions typically require 5, 10 or 20 percent down; and because of the private mortgage restrictions, those having higher credit scores are usually the only ones able to qualify. Does that mean that everyone else is unable to qualify? I don’t think that it does.

I made the comment during that Washington meeting that I believe the heart of our industry, that is the people who buy manufactured housing, typically will have between a 620 and 660 FICO score business. Those private companies that are in the marketplace today, with the exception of 21st Mortgage and perhaps Vanderbilt because of their funding capabilities with Berkshire Hathaway, the bulk of the companies are buying 680 plus FICO score business; and while they may do some with five percent down, they’re going to have to have a higher FICO score for the most part. The 620 to 680 FICO score customer is still a legitimate customer capable of buying a manufactured home and they deserve an opportunity for financing.

The other way FHA permits financing opportunities for those customers, is with a five percent down payment. Because a lot of those loans can be securitized with Ginnie Mae, the interest rates charged to the borrowers are actually going to be more advantageous than some of the conventional money or portfolio money that’s out there today. As a result of that, it provides a nice window for FHA to provide a way for people to buy homes that maybe aren’t being served today in most of the conventional markets for manufactured housing.

And I think provides a tremendous opportunity for our industry, for people in the land-lease communities as well. I think it gives them a potential source of financing because I really see the Title I program for chattel financing focusing more in the 600 or 620 to 680; and then to the extent that higher credit quality customers would drift toward an FHA loan, they would do so because of the interest rates or the down payment situation.

---

Be sure to catch the second part of the MHMSM.com exclusive report with Dick Ernst when we discuss the future of Fannie Mae and Freddie Mac, the recent housing bubble, the SAFE Act and its impact on the Manufactured Housing industry and more.

Click for Part Two of this interview

On Thursday, August 5, the Senate Energy and Natural Resources Committee will mark up a number of energy bills. Included in the mark up is the Energy Efficient Manufactured Housing Act (S. 1320) sponsored by Sen. Jon Tester (D-MT). Assistance is needed from MHI members to ensure the committee favorably reports the measure.

ACTION NEEDED:

MHI members with Senators serving on the Energy and Natural Resources Committee are urged to personally contact their offices and ask them to vote in favor of S. 1320. A list of the Energy Committee members is below. In addition, Senators should be urged to contact both Democratic and Republican Senate leaders to request the Energy Efficient Manufactured Housing Act be included as part of any energy legislation or job creation measure the chamber may be developing. Contact Rae Ann Bevington at 703-558-0675 or RBevington@mfghome.org for additional information.

BACKGROUND:

In March 2009, Rep. Baron Hill (D-IN) introduced the Energy Efficient Manufactured Housing Act (H.R. 1749). Companion legislation (S. 1320) was introduced in the Senate by Senator Jon Tester (D-MT) on June 22, 2009.

On May 6, 2010, the House of Representatives adopted a broad-scale home energy retrofit bill (Home Star Energy Retrofit Act of 2010; HR 5019), which includes amended provisions from the Energy Efficient Manufactured Housing Act. The legislation was referred to the Energy & Natural Resources Committee for consideration.

Both bills authorize the Department of Energy (DOE) to make grants to states to provide owners of manufactured homes constructed prior to 1976 with a one-time only rebate of up to $7,500 to use towards the purchase of a new Energy Star qualified manufactured home. To cover the additional cost of removing and recycling the old home an additional grant of up to $2,500 to be provided upon proof of decommissioning. To be eligible, home owners could not have a total household income in excess of 200 percent of an area’s poverty level. The legislation permits replacement of substandard mobile homes with ENERGY STAR homes as an eligible use of up to $6,500 of the American Recovery and Renewal Act Weatherization Assistance Program funds. Current law forbids weatherization funds from being used for replacement.

KEY TALKING POINTS:

Members of Congress are asked to endorse the Energy Efficient Manufactured Housing Act (H.R. 1749 & S. 1320) for the following reasons:

• The program would provide resources for low-income homeowners to purchase new energy efficient homes and help dispose of outdated homes and improve living standards for potentially millions of families
• Households participating in the program could save an average of $1,800 per year in energy costs, which could be used to help offset monthly home expenses and help build equity in a home
• Each new manufactured home constructed creates more than one new American job; the measure could potentially create more than 51,000 high-quality U.S jobs over the next three years and generate more than $8 billion in construction related spending
• The improved efficiency of an Energy Star home would reduce household carbon emissions by nine tons per household per year and a total reduction of 1.4 million tons of greenhouse gas emissions per year

COMMITTEE ON ENERGY & NATURAL RESOURCES

Democrats

Chairman Jeff Bingaman (NM) (202) 224-5521

Byron L. Dorgan (ND) (202) 224-2551

Ron Wyden (OR) (202) 224-5244

Tim Johnson (SD) (202) 224-5842

Mary L. Landrieu (LA) (202) 224-5824

Maria Cantwell (WA) (202) 224-3441

Robert Menendez (NJ) (202) 224-4744

Blanche Lincoln (AR) (202) 224-4843

Bernard Sanders (I) (VT) (202) 224-5141

Evan Bayh (IN) (202) 224-5623

Debbie Stabenow (MI) (202) 224-4822

Mark Udall (CO) (202) 224-5941

Jeanne Shaheen (NH) (202) 224-2841

Republicans

Lisa Murkowski (AK) (202) 224-6665

Richard Burr (NC) (202) 224-3154

John Barrasso (WY) (202) 224-6441

Sam Brownback (KS) (202) 224-6521

James E. Risch (ID) (202) 224-2752

John McCain (AZ) (202) 224-2235

Robert Bennett (UT) (202) 224-5444

Jim Bunning (KY) (202) 224-4343

Jeff Sessions (AL) (202) 224-4124

Bob Corker (TN) (202) 224-3344

Attached, for your information, review and use, are MHARR’s comprehensive comments in response to the proposed rule on “On-Site Completion of Construction of Manufactured Homes” published by HUD on June 23, 2010. MHARR, as with its comments on proposed rules concerning the “Duty to Serve Underserved Markets” and “Test Procedures for Roof Trusses”, has prepared and filed these comments at an early stage in the rulemaking process so that they are available as a model, basis, or support, as needed, for individual comments filed by industry members. Comments in response to the proposed rule must be filed no later than August 23, 2010. A copy of the proposed rule can be downloaded for your convenience.

As the attached comments indicate, MHARR supports the proposed rule, but with significant conditions attached, that involve key clarifications and modifications of the rule as proposed. Simply put, on-site completion under this rule could either be extremely beneficial for the industry and its consumers, or could backfire on both. If properly finalized and implemented by HUD, with the clarifications and modifications identified by MHARR, a timely, cost-effective on-site completion process could expand existing markets for the industry and open new ones. Conversely, if the industry does not provide HUD with the input that it needs to develop such a proper final rule, and the final published rule does not contain the necessary clarifications and modifications, the on-site process could actually do more harm than good, leaving the industry and consumers with no choice but to oppose the final rule.

Consequently, it is important that industry members review and familiarize themselves both with the proposed rule and with MHARR’s comprehensive comments and submit their own individual comments accordingly.

MHARR extends its thanks and gratitude to the industry members and, particularly, the manufacturer regulatory, legal and technical executives, and retailers, who were instrumental in analyzing the proposed HUD rule and assisting MHARR in the development of its attached comments.

MHARR will continue to keep you apprised as this rulemaking process advances.

Download – MHARR Comments on Proposed On-Site Rule

Danny D. Ghorbani, President
Manufactured Housing Association for Regulatory Reform
1331 Pennsylvania Ave N.W., Suite 508
Washington, D.C. 20004
Phone: 202/783-4087
Fax: 202/783-4075
Email: mharrdg@aol.com

by Eric Miller with L. A. ‘Tony’ Kovach for MHMSM.com

MHMSM: Congressman Jones, we want to thank you for taking this opportunity to share your views on Manufactured Housing Industry related issues with us. Tony had a good time talking with you last week at the MHI Industry Reception in Washington, DC.

WJ: Thank you. I enjoyed it myself and I am delighted to talk to you and have this opportunity. I think you know I’ve been asked to co-sponsor the licensing clarification act and I am now a co-sponsor.

MHMSM: How important is the manufactured housing industry in terms of employment and providing affordable housing to North Carolina and the country in general?

WJ: I have always felt that affordable housing is important to almost any area. Because people work hard to make a living, we certainly want them to have the opportunity to have adequate and appealing housing. It’s been one of my beliefs for years and years, long before I came to Congress. To me, if a family or an individual desires to have their own home, I think the availability is what’s important.

As we discussed last week at the reception, unemployment is a grave concern. As we have more and more unemployment, it’s impacting the industry as well. By creating the financial and other channels needed for prospective home buyers to purchase today’s quality manufactured housing, we can also create or sustain more employment for American workers. Each of these is important to North Carolina and to our Nation.

MHMSM: We are all interested in good government. The current situation with FHFA and the Duty to Serve provisions demonstrates how the intent of Congress can be hampered by regulators. The biggest problem in the manufactured housing industry today is a lack of reasonable retail financing, especially home-only financing which is about 60% of all Industry finance transactions. Congress passed the Duty to Serve provisions two years ago, but many in the industry say they’ve not been properly implemented, and personal property financing is still largely unavailable. What can we or the Congress do to get the FHFA and the GSE’s to provide home-only financing to help make affordable manufactured homes accessible?

WJ: When I met with a representative of MHI last week, he brought such issues to my attention; that’s why I went onto [Congressman] Joe Donnelly’s bill, because whenever Congress passes laws where agencies institute regulations, many times there are unintended consequences. As a legislator, what you are seeking is to try to help a given situation. As it was brought to my attention, here we are with a multitude of regulations that at this point aren’t carrying forward the intent of the Congress.

I was at Clayton Homes center a few weeks ago with an effort by their Mr. Fox to sign a banner to send over to our troops in Afghanistan and Iraq, something he’s done for at least the last five years. When I was there, I overheard a family who had walked up to sign the banner. But they also said to Mr. Fox, “We really appreciate our home, thank you for helping us finance our home.” In some situations, the way the SAFE Act is being viewed at present, the salesman on the sales lot cannot recommend a financial institution that the family can go to and borrow money to purchase a manufactured home. That is cumbersome for everyone involved, starting with that prospective customer. We need to clarify that with the regulators, because it wasn’t the intent of the SAFE Act law.

Well, as I knew before I came to Congress, not all the financial institutions are into loaning money for manufactured homes. The way I look at this, I know I see the growth and development in the manufactured homes industry and how these homes today are not what they were even 20 years ago. They are quality homes now and homes I would be glad to live in if that were my choice. I know that the respect for manufactured homes is at a whole different level than it was years ago. Financing and regulations should reflect that new reality of the quality of today’s manufactured home.

MHMSM: In another example, Congress with good intent passed the SAFE Act, but this is another piece of legislation that observers say that once it got into the hands of regulators, has had serious unintended consequences. The SAFE Act was designed primarily for the conventional housing and the mortgage industry, but regulators have been interpreting it to apply to manufactured housing. That puts a heavy strain on small mom-and-pop-size businesses, but also larger firms as well. Industry lenders are facing huge costs of compliance. The HR 5369 amendment would exempt MH sales people and community managers from the provisions of the Act. What do you think we can do to move this ahead through the Congress?

WJ: I’m on the bill now. I think you’ve got to educate and go back to States and business leaders. To me, this is of great interest to the person who owns the sales lot, but should also be of interest to local chambers because there are many people who desire to own a manufactured home. I think education back home in the States where we have these manufactured homes being sold is an important step. They need to educate the people to the fact there is a bill to clarify the meaning of the SAFE Act, which I think is very important and that is to bring the freedom to communicate, to sell. To muzzle sales people or a community manager under the guise of the SAFE Act was never the idea behind that law. HR 5369 can help address that issue.

MHMSM: Danny Ghorbani, who heads up the Manufactured Housing Association for Regulatory Reform (MHARR) said that Congress “loves the manufactured housing industry.” He also said that Congress has given us these great pieces of legislation such as the MH Improvement Act of 2000, FHA Title I reform and the Duty to Serve underserved markets. Does Congress need to hold hearings with regulators to help implement these good laws as intended?

WJ: Sometimes members of a committee and particularly members of an oversight committee have the authority to hold hearings to see if a law can be implemented as it was intended by Congress. Sometimes it can be helpful. I think again, in this case, that educating the people in the federal government or in a State to understand that these rules and regulations come from legislation. Too many times they need to be reviewed for the reasons you noted. It always helps to review and make sure a law is implemented as intended. A lot of times, it’s a matter of a member of Congress writing to a regulatory agency asking how they implemented the law. It doesn’t have to be a committee holding hearings to get attention. I’ve been part of a number of members of Congress writing letters to regulatory agencies asking how they are interpreting the law. You don’t get a quick answer, but you get an answer. They go to their legal staff to help them respond so it will be accurate.

MHMSM: Are there any additional parting thoughts you would like to share?

WJ: Be involved. The world we live in today is so different. Whether its manufactured homes or not, I would say to any industry or members of the community, be involved. Residents of manufactured homes are very active in the community and they should let their interests be known. Really, I think that’s the reason the manufactured homes industry has evolved into the respect it has earned. Because you are providing a quality home for people. That’s what makes the difference in the Federal legislature and the State legislatures. When you have arrived at this current level of quality and appeal, and you have earned the respect by providing a quality product, then that changes the whole debate.

EM: Thank you for taking the time to talk to us.

TK: Congressman, I just wanted to personally thank you. You’ve made some excellent talking points. Once we finish putting the interview together, we’ll make sure your office has a copy and I hope that you’d be open to doing this with us again sometime in the future.

WJ: I’ve enjoyed it, thank you very much; and I have a great appreciation for your industry, I really do.

TK: I can sense that and I had a fantastic time chatting with you at the reception.

WJ: Thanks for that, too.

TK: You’re one-of-a-kind and just God bless you, sir.

WJ: God bless you, too, both of you, and may God continue to bless America; we sure need His love.

TK: Amen to that, sir.

WJ: God bless.

EM: Bye-bye.

July 21, 2010
Alfred M. Pollard
General Counsel
Federal Housing Finance Agency
Fourth Floor
1700 G Street, N.W.
Washington, D.C. 20552

Attention: Comments/RIN 2590-AA27

Dear Mr. Pollard:

The Manufactured Housing Institute (MHI), a trade association representing all segments of the factory-built housing industry including manufacturers, lenders, community owners and retailers, appreciates the opportunity to submit formal comments in response to the Federal Housing Finance Agency’s (FHFA) Enterprise Duty to Serve Underserved Markets notice of proposed rulemaking (75 FR 32099).

BACKGROUND

There is a long history of Fannie Mae and Freddie Mac failing to serve the needs of the manufactured housing market. The possibility of establishing substantive liquidity for manufactured home loans is severely undermined by the effective monopoly the GSEs have on the secondary lending market and the lack of service provided to the manufactured housing industry.

Ultimately, this hurts consumers and those most in need of affordable housing. Congress recognized this reality, and through the Housing and Economic Recovery Act of 2008 (HERA; P.L. 110-289), specifically established a duty for the GSEs to serve underserved markets, including manufactured housing.

Less than one percent of GSE business originates from manufactured housing. While the GSEs may purchase small amounts of conforming real property manufactured housing loans, they offer virtually no funding for personal property loans. However, since 1989 manufactured housing has accounted for 21 percent of all new homes sold in this country, and in 2009 manufactured housing accounted for 43 percent of all new homes sold under $150,000 and 23 percent of all new homes sold under $200,000.

In requiring the GSEs dutifully serve the needs of the manufactured housing market, Congress intended “to increase the liquidity of mortgage investments and improve the distribution of investment capital available for mortgage financing for underserved markets.” HERA provided further direction that the GSEs “shall develop loan products and flexible underwriting guidelines to facilitate a secondary market for mortgage on manufactured housing.”

Personal Property Lending

MHI is disappointed in FHFA’s proposal to “consider only manufactured home loans titled as real property for the purposes of the duty to serve the manufactured housing market.” HERA specifically provided FHFA the authority and direction to consider loans secured by both real and personal property in evaluating whether the GSEs are in compliance with their duty to serve obligation. Given the prevalence of personal property lending in the manufactured housing sector, FHFA’s proposed rule essentially disregards the wide-scale needs of both the manufactured housing industry and consumer, as well as Congressional intent.

A manufactured home financed with a personal property home loan is among the most affordable forms of homeownership as no land is involved in the loan transaction. Today, the industry estimates that personal property home loans account for at least 60 percent of manufactured housing lending.

The proposed rule indicated that with the GSEs in government conservatorship, FHFA is restricted in its ability to approve any new product lines, including personal property lending. While GSEs do not currently purchase personal property home loans, they have in the past purchased asset-backed securities collateralized by manufactured personal property home loans and have purchased loans directly from lenders for their portfolios. The GSEs cannot serve the manufactured housing market by eliminating the 60 percent of manufactured homebuyers who finance their homes using a personal property home loan.

The industry is willing to consider all facets of a responsible lending program for personal property lending that would give the GSEs adequate protection from loss, including:

• Single-family, owner occupied, primary residence limitation
• Fully documented income
• Fully amortizing loans
• Fixed rates
• Fixed payment
• Low prepaid finance charges and fees
• Longer term leases in land-lease communities
• Minimum FICO Scores
• Maximum 90 percent loan-to-value ratio
• Self-Servicing by lenders and community owners
• Internal reserves for losses (self-insured)
• Risk sharing by lenders and community owners

In its proposed rule, FHFA indicated there are questions regarding consumer protections on personal property home loans. However, there are various laws and standards, both at the federal and at the state level, that protect consumers receiving a personal property home loan for a manufactured home.

For instance, HERA included amendments to the Truth in Lending Act (TILA), known as the Mortgage Disclosure Improvement Act of 2008 (MDIA). Regulation Z, which implemented TILA, was also amended to implement MDIA.

In general, TILA requires creditors to disclose the cost of credit as a dollar amount (the finance charge) and as an annual percentage rate (APR). To better protect consumers, MDIA broadened these guidelines by requiring lenders make certain disclosures to consumers about the terms of their loans. All loans subject to the Real Estate Settlement Procedures Act (RESPA) must include TILA disclosures. The manufactured housing industry applies the provisions of TILA to all loans where real property is involved as well as to personal property home loans. A number of MDIA requirements that now impact personal property home loans for manufactured homes include:

• TILA disclosures must be given to the customer (by delivery or placing in the mail) no later than three business days after the lender receives the consumer’s application for a loan;
• Closing cannot take place until, or after, the seventh business day after the delivery/mailing of the TILA disclosure;
• If the APR provided in the TILA disclosure changes beyond a specified tolerance for accuracy, the lender must provide a corrected disclosure, which the consumer must receive on, or before, the third business day before closing;

No fees, except for a bona fide credit report fee, can be collected by the lender before the consumer receives the TILA disclosure.

Other MDIA requirements affecting manufactured housing personal property home loans include: the creation of a category of higher-priced mortgage loans; lenders must now specifically determine a consumer’s ability to pay and are no longer able to make loans on stated income; and, lenders must verify a customer’s ability to pay based on the customer’s income.

Additional federal consumer protections include the Secure and Fair Enforcement for Mortgage Licensing Act of 2008 (SAFE Act), also enacted as a part of HERA. The SAFE Act is designed to enhance consumer protection and reduce fraud by requiring states to establish minimum standards for the licensing and registration of mortgage loan originators, including originators of personal property home loans.

The SAFE Act’s primary objectives include the creation of a comprehensive licensing and supervisory system with uniform application and reporting requirements. All states are required to implement legislation that meets the minimum requirements of the SAFE Act. To date, most states have enacted legislation implementing the SAFE Act. The SAFE Act also directs the establishment of a nationwide mortgage licensing system and registry. Manufactured housing lenders are required to have their loan originators licensed and registered in accordance with the SAFE Act.

The industry is willing to engage FHFA in addressing its concerns with respect to personal property lending. Ultimately, MHI believes FHFA must reconsider its approach to personal property lending and approve this type of lending activity by the GSEs.

Manufactured Housing Community Lending

Unless a GSE has been engaged in the commercial lending market for manufactured home communities prior to the implementation of government conservatorship, FHFA’s proposed rule precludes the GSEs from developing new activity in this arena. MHI strongly believes the GSEs should be directed to purchase commercial manufactured housing community loans under their multifamily goals.

The recent slowdown in commercial lending has made it extremely difficult for owners of land-lease communities to refinance their properties. The ownership of a manufactured home sited in a land-lease community is one of the most affordable forms of home ownership.

In 2008, Fannie Mae’s multifamily loan volume through its Delegated Underwriting and Servicing (DUS) program was approximately $33 billion. However, only $1 billion of that total volume was in manufactured home communities. Historically, manufactured housing community loans have performed well and land-lease communities offer one of the most affordable forms of homeownership for moderate-, low-, and very low-income households. GSE activity in this area is vital to maintaining the health of this sector and to ensuring the availability of this important supply of affordable housing. Additionally, we understand that the proposed rule now precludes Freddie Mac, who was actively engaged in preparing to enter the market by the 3rd quarter, has now curtailed these efforts. Fannie Mae has demonstrated for years they have been able to operate in this space, why should Freddie Mac not also be allowed to compete for this business, and bring this very important capital source to the market? This policy must be reconsidered.

Land-Home and Real Estate Manufactured Housing Mortgages

The GSEs have existing mortgage loan programs that provide for financing of manufactured homes. While Fannie Mae’s MH Select program provides for a 97 percent LTV, no loans have been originated due to the program’s highly restrictive nature.

These programs are very limited primarily due to the unavailability of private mortgage insurance (PMI) for manufactured housing. Private mortgage insurance companies routinely deny coverage for manufactured housing loans, or in a limited number of cases, coverage may be available on an 85 percent LTV loan where the costs of PMI are higher than for site built housing.

The requirement to have PMI on any loan greater than 80 percent LTV places a reliance on a private insurance product that is generally unavailable and has historically had a negative impact on the GSEs’ financing of the industry’s homes.

FHFA is urged to approve some form of self-insurance mechanism for the GSEs, similar to the Federal Housing Administration (FHA) insurance program, which eliminates the dependence on a private insurance industry that is not currently positioned to provide sufficient loan level loss protection.

For many years, manufactured housing industry lenders self-insured against credit loss and can provide valuable assistance in developing the levels of reserves needed to cover losses. This mechanism can also allow FHFA and the GSEs to address non-conforming loans in rural areas where appraisals and comparables are not readily available. We believe that a graduated premium, dependent on the LTV and the credit evaluation, is a model the industry can embrace.

Another underwriting issue relates to appraisals. Manufactured home appraisals occur in two situations: 1) a new home purchase that includes both the cost of the home and all typical installation and set up items; and 2) an existing home purchase where the home is already sited and ready for occupancy.

The unique nature of the manufactured housing land-home transaction has resulted in the need for flexibility in appraisal methods. The typical manufactured housing land-home appraisal requires both a market analysis and a cost analysis. The majority of land-home appraisals for manufactured housing occur in rural areas where little or no comparable sales data exists, thereby limiting the effectiveness of the sales comparison approach. There needs to be latitude for appraisers to determine whether or not the sales comparison approach, the cost approach, or a blend of the two is the best measurement of value depending on the information that is available.

Underwriting guidelines for land-home transactions should also maintain personal property characteristics for titling purposes. We believe that maximum flexibility should be provided to the GSEs in permitting lenders to select the lien perfection approach that provides the most effective means of default resolution.

Three broad categories of lien perfection for manufactured housing exist.

• Home only loan transactions: occurs when a security interest is recorded on the title of the home and the home remains personal property and not affixed to the real estate
• Traditional mortgage transaction: where the lien recordation and perfection is on the real estate and all improvements including the home; the lender follows the normal foreclosure procedures identical to those of site built homes
• A hybrid of the two: the lender files a lien on the home only and records a lien against the real property as well; this allows the lender the option of separating the home from the real estate for both a quicker resolution towards default resolution and quite possibly a lower loss severity; this option provides lenders with maximum flexibility in protecting their secured interests

---

MHI recognizes the GSEs are in a weakened state and hesitant to make changes to their existing business models. However, Congress, through HERA, recognized a fundamental lack of service existed and specifically directed the GSEs to begin to dutifully serve the entire needs of the manufactured housing market.

The manufactured housing industry can appreciate the difficulty and uncertainty of operating in a stressed environment. New manufactured home construction has fallen 86 percent over the past ten years, which has accounted for 167 plant closures, more than 7,500 home center closures, and over 200,000 lost jobs. Most importantly, thousands of our customers have been unable to buy, sell, or refinance their homes.

While we appreciate the concerns raised by FHFA to ensure the GSEs remain viable economic institutions and that adequate consumer protections are in place, FHFA and the GSEs have an obligation to serve manufactured housing and the 18 million Americans that currently reside in manufactured homes.

The proposal to potentially eliminate personal property lending from the GSE duty to serve requirements not only fails to serve the underserved manufactured housing market; it fails to serve the larger underserved affordable housing and rural housing markets.

MHI looks forward to working with FHFA in the weeks ahead on these issues. If you need further information regarding any area discussed in this comment letter, please contact me at (703) 558-0678 or tlong@mfghome.org.

Sincerely,

Thayer Long
Executive Vice President Manufactured Housing Institute

By Ken Rishel

Anyone familiar with the Captive Finance Newsletter knows I have very little faith in any government backed chattel finance program coming to fruition or, if it does, being the answer to the manufactured housing industry’s prayers. If it happens, it will only double the current sales volume and that is not enough. However, it is worth some effort to try to make it happen because doubling industry sales is an important thing, even if it isn’t the whole answer. While I still believe that owner assisted financing is the real answer, I am asking you to join me in a last ditch effort to help MHI in their efforts to make this thing work.

For those of you who don’t know, MHI made a plea last week at their Summer Meeting in Washington DC for industry members to email the government and their Congressmen and Senators asking FHFA to not ignore their duty to serve. Greg O’ Berry of Hometown America went even farther and suggested both at the MHI meeting and in this ezine that community owners and operators ask their residents to also email everyone explaining that the value of their investments in their homes would be adversely affected if government backed chattel financing did not come to fruition.

Because I am skeptical about this program ever emerging and because I am so focused on more complete solutions, I have not lifted a finger to help. I have however, come to realize that is the wrong attitude. Nothing is ever won by people finding fault, or not trying to make something work, and I now do not want to feel as if I did nothing when something could make a difference. This manufactured housing industry is something special, and all of us owe it more than we can ever repay. We just need to realize it, and pay up in some measure. I know that, because that is what has kept me running 16 hours a day while being called a fear merchant for the last several years, when I could have been on a beach in Hawaii watching my wife learn the Hula. I know it, but I didn’t act on it when it came to this issue. I am ashamed of my lack of action. To those of you who have already gotten involved, I apologize for my lack of action.

Perhaps it was Greg’s impassioned plea, but it struck me that all of us in this industry, no matter how cynical, could at least stand up and be counted on this issue. As a result, I am emailing everyone that makes sense tonight ( FHFA, Congressmen, and Senators) after I finish this article to you. My question is, “What are you going to do”? Will you make the same effort after reading this? Will you reach out to others and persuade them to do the same? If you are a community owner, operator, or manager, will you follow Greg’s lead and ask your residents to do the same? Will you stand up and be counted?

Ken Rishel of Precision Capital Funding is a leading expert in chattel financing of manufactured homes and in starting and running owner assisted finance operations. His organization was named MHI’s Service Supplier of the Year for 2010, and he authors and publishes the Chattel Finance Newsletter which goes out to over 9,000 people on a monthly basis.

The decision by the FHFA to exclude loans on manufactured homes on leased land from their proposed rules to implement the duty to serve underserved markets as outlined in HERA will be financially devastating to existing manufactured homeowners. If the GSE’s do not offer loan programs for MH homeowners, the financing available to potential home buyers will be severely limited, costly or non existent.

We recommend that community owners encourage their residents to write their congressional representatives and let them know that the GSE’s exclusion of MH loans in land lease communities will be devastating to the value of their homes, significantly limiting their ability to sell their home for a fair value, thereby causing severe financial loss if the resident needs to move. The resident should suggest that the FHFA should treat a manufactured homeowner the same as a stick built homeowner and not abandon the support of millions of MH homeowners living in MH communities.

MHI will be developing a sample letter in the next few days for distribution to community residents. The deadline for comments is July 22nd, so we must mobilize swiftly if we are to get resident comments to the FHFA by July 22nd.

Greg O’Berry
President and COO
HometownAmerica

In the MHMSM.com download area please find the reprint copy of the “MHARR VIEWPOINT” article titled “RESTORING THE STATURE AND STATUS OF THE MHCC” published in the July, 2010 issue of the Journal magazine.

A great deal of misinformation has been circulating around the industry regarding the status of the Manufactured Housing Consensus Committee (MHCC) and recent steps taken by HUD regulators and attorneys that threaten to turn the MHCC into an impotent and irrelevant forum akin to the now-defunct National Manufactured Housing Advisory Council (Advisory Council).

The must-read MHARR Viewpoint article details these ongoing efforts to downgrade the role, authority, functionality and independence of the MHCC, placing them in the context of the background and history of the MHCC as one of the centerpiece reforms of the 2000 law. By tying together the history and development of the MHCC as an independent replacement for the HUD-dominated, rubber-stamp Advisory Council, the column shows just how far recent changes have degraded the MHCC and the extremely negative impacts that these changes will have going forward, unless they are halted and reversed.

Manufactured Housing Association for Regulatory Reform
1331 Pennsylvania Ave N.W., Suite 508
Washington, D.C. 20004
Phone: 202/783-4087
Fax: 202/783-4075
Email: mharrdg@aol.com