After reading a comment to my previous post from a mortgage broker, I asked Ken Ryan from Ark Funding Group to clarify what I thought I heard him say about Freddie Mac no longer buying mortgages for manufactured housing. It turns out it’s not quite as cut and dry as I implied in the post.
First of all, I’m a customer, not an expert. Any readers who are looking at getting a mortgage of any kind need to consult with knowledgeable people and do their own research to make a decision that’s best for them. I am not one of those knowledgeable people. But with each refinance I’ve been involved in, I’ve picked up a bit more information. Here’s the deal with manufactured housing loans, as I understand it. Fannie Mae and Freddie Mac don’t have a policy to not buy those loans. However, Fannie Mae has been known to refuse to pick up manufactured housing loans at the auction. Perhaps Freddie Mac too, but Ryan said specifically Fannie Mae. So, this means that if you are a bank with a manufactured housing loan, you might bring it to the auction expecting Fannie Mae to buy it. Fannie Mae may have even told you it would buy that loan. But in the back of your mind you know that Fannie Mae might bail out on you and leave you holding that loan. If you needed the cash right then, not being able to sell your loan could spell trouble. For many lenders, that is more risk than they are willing to take, so they won’t touch a manufactured home. Other lenders will take the risk, but they hedge it some by passing on a higher interest rate to the customer or they limit the loan to value ratio for that loan.
My best option at this point is an FHA loan, and despite interest rates having taken yet another jump upward, I have a fixed rate loan locked in at 7%. If all goes well, my husband and I will close at the end of the month. I asked Ryan who buys the FHA loans, and he said FHA does. It’s a completely different program than Freddie Mac or Fannie Mae.
So anyway, that’s the situation with manufactured housing as I understand it so far. Again, I’m not an expert and don’t really want to be. I’m simply hoping to become a satisfied customer.
Hi Fernanda, I just caught your post and your mention of an FHA loan being the best option for your at this point. If you’d like to learn a bit more about FHA loans, I just co-edited a consumer guide on them that is geared towards basic education on the program. It’s available in pdf format for download at Mortgage Loan Place .com (see the link I left in my contact info). Hopefully that could be a good resource for you and best of luck. I’m glad I stumbled across your blog.