Manufactured Home Lot and Combination Loan Insurance

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Summary:
This program insures mortgage loans made by private lenders to buyers of manufactured homes and the lots on which to place them.

Purpose:
HUD has been providing mortgage insurance on manufactured homes under Title I since 1969. By protecting mortgage lenders against the risk of default, HUD's participation has encouraged them to finance manufactured homes, which had traditionally been financed as personal property through comparatively high-interest, short-term consumer installment loans. The program thereby increases the availability of affordable financing and mortgages for buyers of manufactured homes and allows the buyers to finance purchase of their home at a term and interest rate comparable with the commercial loans typically used to finance manufactured homes.

Type of Assistance:
Title I programs offer coinsurance--HUD insures private lenders against losses of up to 90 percent of the value of a single loan, while the lender retains responsibility for the remaining 10 percent. In addition, the insurance coverage is limited to 10 percent of the lender's Title I portfolio. The buyer must agree to make a downpayment and interest rate payments determined by the lender.

Title I insurance may be used for loans of up to $64,800 for a manufactured home and lot and $16,200 for a lot only. The lot must be appraised by a HUD-approved appraiser. The dollar limits for combination and lot loans may be increased up to 85 percent in designated high-cost areas. The maximum loan term is 20 years for a single-module home and lot, 25 years for a multiple module home and lot, and 15 years for a lot only.

Eligible Grantees:
Private lending institutions are eligible for insurance on loans made under the program.

Eligible Customers:
All buyers of manufactured homes who plan to use the homes as their principal residence are eligible for the program.

Application:
Buyers of manufactured homes may apply for insurance through a HUD-approved lender or through a lender's approved retailer.

Technical Guidance:
The program is authorized under Title I, Section 2 of the National Housing Act (12 U.S.C. 1703). Program regulations are in 24 CFR Part 201. These regulations, as well as applicable handbooks and notices, are available electronically through HUD's policy documents website known as HUDclips. The program is administered by the Office of Housing, Federal Housing Administration.

For More Information:
For more information, phone (800) CALL FHA or (800) 225-5342. To learn more about manufactured housing options and opportunities, visit HUD's Manufactured Housing web page or the Manufactured Housing Institute website.