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MHI 2013 Annual Meeting Recap

October 10th, 2013 No comments

IMHA Executive Director Mark Bowersox attended the Manufactured Housing Institute’s (MHI) annual meeting held September 28 – October 1 in Carlsbad, CA. As with most recent industry meetings, speakers and conversations at the event were focused on the impact of the Dodd-Frank consumer protection legislation and reforming the CFPB’s upcoming regulations. MHI and other industry representatives continue to work with the CFBP on three key areas:

Exemption for manufactured housing appraisal requirements

Based on the most recent rules issued by the CFPB loans on all new manufactured homes, regardless of whether or not they included land, are exempt from the appraisal requirement. Loans on existing manufactured homes, not including land, are also exempt from the appraisal requirements. Additionally, all mobile homes (pre-HUD code) home loans are exempt. The CFPB’s rule solidifying these exemptions is still pending. When finalized the rule will go into effect in January.

Key rule clarifications and exclusions

Loan originator compensation guidelines issued by the CFPB this summer provide the industry with key exclusions from the points and fees calculation that lenders must perform and clarifies certain activities that retail sales staff can engage in without being defined as loan originators.

Manufactured home sales price is excluded from the points and fees definition and does not have to be included in calculations performed by lenders unless a creditor has knowledge that the sales price includes compensation for loan origination activities.

 

Retail sales commissions paid to employees is excluded from points and fees calculation requirements unless the salesperson is receiving compensation from a lender for loan origination activities.

According to MHI, activities that do not classify a retailer or its sales personnel as loan originators include:

  • Providing or making available general information about creditors and loan originators that may offer financing for manufactured housing
  • Gathering or collecting supporting information or documentation on behalf of a consumer for inclusion in a credit application
  • Providing general credit application instructions so that a consumer can complete it themselves
  • Financing the sale of no more than three homes in a year.

Activities that will make a retail employee be considered a loan originator include:

  • Filling out a credit application for a customer
  • Discussing particular credit terms with a customer
  • Directing or influencing a customer to select a particular lender or creditor

MHI continues to seek from the CFPB to provide further clarification on what activities retailers can engage in without being defined as loan originators.

MHI is still working with the CFPB and various consumer interest groups on the need to revise the upcoming High Cost Mortgage Loan triggers for manufactured home loans. IMHA will continue to be engaged on this issue, along with MHI and other interested parties. ##

mark-bowersox-imha-posted-industry-voices-guest-blog-mhpronews.com-75x75pxl-.pngMark Bowersox
Executive Director
Indiana Manufactured Housing Association
Recreation Vehicle Indiana Council
3210 Rand Road
Indianapolis, IN  46241

(Editor's Note: You can find more info on the LO Comp Rule and HOEPA from DJ Pendelton's article published in the Industry In Focus Reports module, linked here.

 

You can also find Mark Bowersox's “It's Now or Never” featured article, linked here. )

Retail Sales Trend Up Despite New, Looming Threat

May 25th, 2012 1 comment

According to Statistical Surveys, a provider of objective industry data, Texas' new manufactured home retail sales were up 29 percent for the three months ending March 31 over the same period last year. This follows on the heels of a flat Q4 2011 when compared with Q4 2010. Texas also ranks first in national shipments to retailers through March 2012 with a 20 percent share, and number one in units produced with a 27 percent share according to the latest MHI Monthly Economic Report for March 2012. 

While great news for the industry, an ominous threat lies ahead as the young Consumer Financial Protection Bureau (CFPB) begins rule writing for implementing Dodd-Frank and the S.A.F.E. Act.

On behalf of the membership, the TMHA Board approved taking an active part in the federal arena, where this will all play out, at our May 18 Third Quarter Board Meeting. 

I have been in the industry 43 years – the spectrum of consequences we face from this new regulation is something never witnessed.   

 

Some examples:

  • New rules could potentially force lenders to discontinue making lower balance loans such as what we typically see for single section home-only loans, and result in an exit of lenders.
    • One of the largest industry lenders estimates 40 percent of their loan volume is under this threshold.
  • These new federal rules would also certainly impact retailers, manufacturers and communities.
    • While MHI introduced an industry-supported bill in Congress (HR 3849) to reduce regulatory burdens that impede access to affordable manufactured housing financing, the likelihood of this passing anytime soon if at all in our deadlocked Congress is slim.
      • We have been told this directly by those that should know and have extensive knowledge of the current national legislative climate.

 

Experience has shown it's much easier to influence the writing of a new rule than it is to change a rule once it's written. TMHA is not going to sit on the sidelines to see what happens.

 

We want an industry voice to be heard.
 

Your association has several key resources that, if combined with that of MHI, fellow state associations and industry members, will see that manufactured housing has direct input in the federal rule writing process:

  1. First, our large, informed and dedicated member base understands the dynamics of our business model and that it relies heavily on portfolio lenders.
    • While mortgage lenders in the traditional housing market produce loans, sell the servicing to another party and look to the government through Fannie Mae or Freddie Mac to take the risk of loss, our lenders do none of that.
    • MH lenders originate loans, service their loans and take the hit on any loss.
      • This requires different loan pricing, fees and loan origination systems than previously envisioned by those writing the new federal laws and most likely the officials charged with writing the rules.
  2. Secondly, our seasoned board and Executive Director DJ Pendleton will give us a voice in this process.
    • DJ brings a strong academic and professional background as an attorney coupled with industry experience, allowing him to understand the new laws, rule writing process and nuances of guiding the consultants we will require to help ensure the industry is heard.

Finally, through conservative fiscal policy, financial support from members over the years and God Bless our Texas economy, TMHA has the financial resources to commit in coordination with others to support this effort in D.C. While no one can guarantee our success, we will at the very least have a voice at the table.

 

Sincerely,

 

Ronnie Richards
Chairman
Texas Manufactured Housing Association