Manufactured-housing 

consumer finance in the 

United States

September 2014
1 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES
2 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

Table of contents

Table of contents.........................................................................................................2

1. Introduction...........................................................................................................4

2. Manufactured housing and its residents............................................................8

2.1 What is a manufactured home?................................................................8

2.2 Geographic distribution of manufactured housing................................ 10

2.3 Residents of manufactured housing....................................................... 13

2.4 Housing costs..........................................................................................20

2.5 The legal treatment of manufactured housing.......................................23

3. Production, sales, and financing.......................................................................26

3.1 Historical manufactured housing finance market dynamics.................26

3.2 Size and composition of the financing market for manufactured 

 housing...............................................................................................29

3.3 Home purchase loan pricing ..................................................................32

3.4 Secondary market for manufactured-housing loans in 2014 ................ 37

3.5 Production of manufactured housing ....................................................39

3.6 Retail ......................................................................................................40

3.7 Manufactured home communities .........................................................42

4. Conclusion ..........................................................................................................44
3 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

Appendix A:...............................................................................................................46

Recent changes to consumer financial protection laws and their potential 

impact on manufactured housing ..........................................................46

Homeownership and Equity Protection Act (HOEPA).................................46

Qualified Mortgage (QM) and Ability-to-Repay (ATR)..................................49

Loan-Originator Compensation.......................................................................51

Higher-Priced Appraisals................................................................................ 52

Higher-Priced Escrows.................................................................................... 53
4 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

1. Introduction

This white paper provides background on manufactured housing, including the market and 

regulatory environment, as well as on consumers who purchase or rent manufactured housing. 

The Consumer Financial Protection Bureau (Bureau) initiated research into manufactured 

housing to provide the Bureau and others with a more comprehensive understanding of 

manufactured housing and its financing. 

Manufactured housing accounts for six percent of all occupied housing and a much smaller 

fraction of home loan originations in the U.S. These fractions notwithstanding, manufactured 

housing is of interest to the Bureau for at least two reasons. First, it is an important source of 

affordable housing, in particular for rural and low-income consumers. Second, manufactured 

housing may raise particular consumer protection concerns due to the nature of the retail and 

financing markets for manufactured housing. This is particularly true to the extent that buyers 

of manufactured homes are more likely to belong to groups, such as older or lower-income 

families, that might be considered financially vulnerable.

Compared with site-built housing and mortgage finance generally, data and information on 

manufactured housing are relatively sparse. Yet, manufactured housing differs from site-built 

housing in several ways, including housing costs and the market for home financing. A key goal 

of the white paper is to bring together information and data from a number of data sources, each 

of which contributes to a more-complete picture of manufactured housing. The Bureau

primarily analyzed data such as the American Community Survey (ACS), the American Housing 

Survey (AHS), data reported under the Home Mortgage Disclosure Act (HMDA), Manufactured 

Homes Survey (MH Census), and the Survey of Consumer Finances (SCF). The Bureau also 
5 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

analyzed proprietary data voluntarily provided to the CFPB.1 To complement its analysis of 

these data sources, the Bureau engaged in outreach to industry groups, consumer groups, 

government agencies, and a variety of market participants and observers.

Key findings of this white paper include:

 Manufactured housing is disproportionately located in non-metropolitan 

areas. Nationwide, manufactured housing accounts for six percent of occupied housing,

compared with fourteen percent of housing located outside of metropolitan areas. At the 

county level, the share of manufactured housing can reach even greater levels: in 112 U.S. 

counties—predominately in Southern and Western states—over one-third of homes are 

manufactured housing.

 Compared with residents of site-built homes, manufactured-housing 

residents are somewhat more likely to be older and tend to have lower 

incomes or net worth. A greater proportion of households that live in manufactured 

housing are headed by a retiree (32 percent) than site-built households (24 percent).2

The median income for households that live in manufactured homes is roughly half the 

median income among families in other types of homes. The median net worth among 

households that live in manufactured housing is about one-quarter of the median net 

worth among other households.

 Manufactured homes typically cost less than site-built homes. On a squarefoot basis, manufactured homes cost less than half as much as the estimated $94 per 

square foot for new site-built housing construction in 2013.3 The average sales price of a 

new single-section manufactured home was about $43,000 in the first six months of 

2014. The average price of a new multi-section manufactured home was about $78,000, 

though expenses of transport, siting, and construction add-ons can add to the cost. The 

 1 To preserve the confidentiality of the data providers, the white paper includes only limited discussion of the analyses 

based on these data and does not identify the institutions that provided the data. Conclusions from the analyses of 

the proprietary data generally align with the conclusions in this report based on publicly available data sources. The 

proprietary data contain no direct consumer identifiers.

2 CFPB analysis of Survey of Consumer Finances (SCF), 2004–2010.

3 U.S. Census Bureau, Cost & Size Comparisons: New Manufactured Homes and Single-Family Site-Built Homes 

(2007 – 2013), available at https://www.census.gov/construction/mhs/pdf/sitebuiltvsmh.pdf , data available at

https://www.census.gov/construction/mhs/mhsindex.html. (This survey was sponsored by the U.S. Dep’t of Hous. 

& Urban Dev. (HUD))
6 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

most basic single-section homes can sell for less than $20,000, and a larger home with 

custom designs or optional finishes and features may cost $100,000 or more.

 About three-fifths of manufactured-housing residents who own their home

also own the land it is sited on. These consumers generally have the option either to 

title their home as real property and to obtain financing through a real estate mortgage 

loan or to title the property as personal property and to obtain chattel financing. 

 An estimated 65 percent of borrowers who own their land and who took out 

a loan to buy a manufactured home between 2001 and 2010 financed the 

purchase with a chattel loan. There are tradeoffs between real-property financing 

and chattel financing. Chattel loans often have lower origination costs and may close 

more quickly than mortgages (loans secured by real property). Interest rates on chattel 

loans, however, may be between 50 and 500 basis points more expensive than real 

property loans, and chattel loans generally have lesser consumer protections than 

mortgages. The extent to which consumers are aware of these tradeoffs and how 

consumers weigh them remains an open question.

 Manufactured-home owners typically pay higher interest rates for their 

loans than site-built borrowers. For example, about 68 percent of all 

manufactured-housing purchase loans (chattel as well as real property loans) reported 

under the Home Mortgage Disclosure Act in 2012 met the definition of a “higher-priced 

mortgage loan” (HPML), a definition developed to identify a set of loans that might be 

considered subprime. By comparison, only three percent of loans for site-built homes 

were HPMLs. Even within the set of HPMLs, manufactured-home loans tend to have 

higher rates. 

 The current state of manufactured housing production, retail, and financing 

reflects in part a rapid growth during the 1990s and subsequent sharp 

contraction. In the 1990s credit standards and underwriting practices for 

manufactured-housing loans became more lax, and the market boomed. The market 

collapsed, however, in the early 2000s as consumers began experiencing repayment 

difficulties, and the market significantly contracted. Poor manufactured-home loan

quality drove high defaults. For example, in the year 2000 alone, more than 75,000 

consumers had their manufactured homes repossessed, about 3.5 times the typical 

number during the 1990s. Between the beginning of 1999 and the end of 2002, 

repossessed inventory grew more than fourfold to $1.3 billion. Today, more than a 
7 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

decade after this collapse, production and sales remain at depressed levels, and the 

secondary market is extremely limited. 

These findings underscore the importance of the manufactured housing sector as a source of 

affordable housing for some consumers, including those outside of metropolitan areas, older 

households, and lower-income households. At the same time, these same groups include 

consumers that may be considered more financially vulnerable and, thus, may particularly stand 

to benefit from strong consumer protections.

The Bureau has recognized that certain provisions of the Dodd-Frank Act that the Bureau 

implemented through rules that took effect in January, 2014, may affect the market for smallersize mortgages and, more specifically, the manufactured housing segment of the market, in ways 

that differ from the rules’ effect on other market segments.4 Because the rules have been 

effective for only a few months, and because there are lags in the availability of data, it would be 

premature to reach conclusions on the market-wide effects of the rules. 

The Bureau will continue to monitor the effect of its rules on the manufactured housing industry 

and on consumers who purchase or seek to purchase manufactured homes. As part of this 

ongoing monitoring, the Bureau will continue to engage with stakeholders and will encourage 

others to build greater knowledge of the manufactured housing market, the consumers in that 

market, and the differences between the site-built and manufactured housing markets.

 4 See infra Appendix for a description of some of these rules.
8 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

2. Manufactured housing and 

its residents

2.1 What is a manufactured home?

Manufactured homes account for a small but important share of single-family housing in the 

U.S. Manufactured homes are commonly referred to as “mobile homes” or “trailers” but in fact 

are a specific type of factory-built housing, constructed in accordance with the U.S. Department 

of Housing and Urban Development’s (HUD’s) Manufactured Home Construction and Safety 

Standards code. A factory-built home constructed after June 15, 1976 is eligible for designation 

as a manufactured home if, among other things, the structure is at least 320 square feet and 

constructed on a permanent chassis.5 Homes that meet these criteria are affixed with a HUD 

label that indicates the homes’ compliance with the relevant HUD codes.

Manufactured housing should be distinguished from trailers, RVs, and park-model homes. 

These vehicles and homes (which are built to different standards than manufactured homes) are 

generally treated as motor vehicles for legal and financing purposes (though in some cases they 

may be permanently sited). On the other hand, modular homes—which are often built in the 

same facilities as manufactured homes—are constructed on site using modular components and 

are generally treated as real property. 

Manufactured homes are available with numerous size and floor-plan options. The homes are 

built in a factory and then transported by means of the permanent chassis directly to a 

placement site after purchase or to retail centers. Single-section homes may be transported in a 

 5 42 U.S.C. §5402.
9 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

single piece, whereas multi-section homes are transported in multiple pieces that are joined on 

site. In 2013, single-section homes accounted for 46 percent of manufactured home placements, 

and this share has fluctuated between one-quarter and over one-half since the early 1990s.

Manufactured homes are required to be professionally installed in accordance with HUD’s 

installation standards.6

Manufactured homes may be placed on individual land plots that are owned by the 

manufactured-home owner, or the homes may be placed on rented land, including on leased lots 

within manufactured home communities. Manufactured housing communities generally require 

a homeowner or renter to pay ground rent and additional fees for shared amenities, services, 

and utilities. Some communities are age-restricted and function as retirement or seasonal 

homes for residents aged 55 or older. Historically, around 25–30 percent of manufactured 

homes have been placed within manufactured housing communities, though the share of new 

homes placed in communities has grown in recent years.7

The bulk of a manufactured home’s appreciation potential comes from the land on which it sits, 

not the structure itself, so the most important factor determining the appreciation (or 

depreciation) of manufactured housing is generally land ownership.8 However, manufacturedhome owners that own the land under the home may still not enjoy appreciation in the 

property’s value if the structure depreciates more quickly than the land increases in value. Thus, 

whether a manufactured-home owner realizes appreciation can depend on a number of factors 

beyond land ownership including the home’s size, location, and investment in maintenance and 

upkeep.9

Once placed, manufactured homes are typically not moved from their original site. Site 

installation includes settlement upon a permanent or semi-permanent foundation support. 

Foundation types range from insulated basements to concrete slabs to block, anchor, and strap 

 6 See 24 CFR part 3285. 

7 See supra note3. 

8 Kevin Jewell, Consumers Union, Manufactured Housing Appreciation: Stereotypes and Data (Apr. 2003)

available at http://consumersunion.org/pdf/mh/Appreciation.pdf.

9 Note that the appraisal process for manufactured homes often differs from the process for site-built homes. In 

particular, manufactured homes titled as chattel are often appraised using “blue book” type of valuation: a 

published guide that provides a value for the house based on the model, the year manufactured, and the condition of 

the house. If a more traditional appraisal is done (generally only for a manufactured home affixed to land), then 

sometimes only other manufactured homes may be used as comparables. Availability of comparables, therefore, 

may also affect valuation of manufactured homes, especially in low-density areas. 
10 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

fixtures. Even manufactured homes secured by semi-permanent foundations, however, are 

infrequently moved. As of 2011, the vast majority of owner-occupied manufactured homes in the 

U.S. were on the same site upon which they were first placed.10 About two-thirds of owneroccupied manufactured homes that are moved from their original site have been re-sold, and 

about one-third remain in the possession of their original residents.11

An important difference between manufactured homes and site-built homes is their potentially 

differing legal treatment. Titling a manufactured home as real property is a choice in most states 

if the owner permanently affixes the manufactured home to land they own (or rented land with a 

sufficiently lengthy lease). However, even where the manufactured home is permanently affixed 

to land, the owner has the option to title the home as personal property (chattel). About threequarters of states have statutorily-defined processes for converting a manufactured home’s title 

from personal property to real property.12 Generally, manufactured homes are treated as 

personal property by default, and documentation that the home has become a fixture is required 

to be considered real property. As discussed in Section 2.5, the decision whether to title a 

manufactured home as real or personal property affects property taxation, applicability of 

consumer protection laws, and financing options.

2.2 Geographic distribution of manufactured 

housing

Manufactured homes account for about six percent of all occupied U.S. housing. As shown in 

Figure 1, manufactured housing is more common in Southern and Western states, where 

manufactured homes account for as much as 17 percent of total housing stock (in South 

 10 According to US Census Bureau American Housing Survey (AHS), 2011, more than 80 percent of owner-occupied 

manufactured homes in the US remain on the site where they were first placed. This estimate excludes the roughly 

eight percent of responses that were “don’t know” or “not reported.” Including these responses reduces the 

estimated fraction of homes that remain on the same site to about 75 percent. U.S. Census Bureau, American 

Housing Survey for the United States (AHS): 2011, Table C-01-AH, pg., 4, available at

http://www.census.gov/content/dam/Census/programs-surveys/ahs/data/2011/h150-11.pdf (CFPB analysis of US 

Census Bureau American Housing Survey (AHS) microdata, 2011).

11 Id.

12 See Corporation for Enterprise Development (CFED) & National Consumer Law Center (NCLC), Titling Homes as 

Real Property (2009), available at http://cfed.org/assets/pdfs/mh_realproperty.pdf.
11 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

Carolina). Manufactured housing is less common in several Northeastern states. At the county 

level, the share of manufactured housing can reach even greater levels: in 112 U.S. counties—

predominately in southeastern and southwestern states—over one-third of homes are 

manufactured housing (Figure 2).

Manufactured housing is more prevalent in rural areas. About two-thirds of all occupied 

manufactured homes in the U.S. are located outside of metropolitan statistical areas (MSAs), 

and 14 percent of homes in non-MSA counties are manufactured homes.13

Manufactured housing industry participants indicate that the greater share of manufactured 

housing in rural areas may be due to a number of factors including low population density, 

which may limit scale efficiencies for residential construction, and in some cases higher 

transportation costs for materials to construct site-built homes. Industry participants also 

frequently point to zoning restrictions as an important reason for the lower prevalence of 

manufactured housing in metropolitan areas. Local zoning laws, particularly in and around 

large cities, commonly preclude placement of manufactured homes as dwellings. For example, a 

city might require that a home be at least 20 feet wide, thereby precluding siting a single-section 

manufactured home, and foundation requirements may discourage placement of manufactured 

housing.14 In some areas, manufactured homes are allowed only in specifically designated areas, 

such as specifically zoned communities or subdivisions. Restrictive zoning and prohibitive land 

development costs are among the reasons there has not been significant development of new 

manufactured home communities in the past decade, though recent trends indicate that 

investment in existing communities is increasing.15

 13 US Census Bureau American Community Survey (ACS), 2008-2012, available at

http://www.census.gov/acs/www/data_documentation/data_main/.

14 Ronald A. Wirtz, Fed. Res. Bank of Minneapolis, Hello, have we met? Manufactured Housing Suffers an Image 

Problem (fedgazette July 1, 2005), available at 

http://www.minneapolisfed.org/research/pub_display.cfm?id=1484. 

15 Multifamily manufactured housing community securities’ share of CMBS issuance has grown to about four percent 

in the past decade. Additionally, in April 2014, Freddie Mac announced a program for manufactured housing 

community loan securitization. See Al Yoon, Freddie Mac Moves Into the Trailer Park, Wall Street Journal, April 

30, 2014 available at http://online.wsj.com/news/articles/SB10001424052702303948104579534120298682710. 

See also Gary Rivlin, The Cold, Hard Lessons of Mobile Home U, New York Times Magazine, March 13 2014, 

available at http://www.nytimes.com/2014/03/16/magazine/the-cold-hard-lessons-of-mobile-home-u.html; and 

L.A. “Tony” Kovach, Sensationalistic ‘Cold Hard Lessons of Mobil Home U” New York Times Article by Gary Rivlin 

Draws Manufactured Home Industry Ire, Desire, and Fire, Manufactured Home Living News (2014), available at

http://manufacturedhomelivingnews.com/sensationalistic-cold-hard-lessons-of-mobile-home-u-new-york-times-
12 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

MANUFACTURED HOUSING SHARE OF OCCUPIED HOUSING UNITS, BY STATE.16 FIGURE 1: 

 

article-by-gary-rivlin-draws-manufactured home-industry-ire-desire-and-fire/ (discussion of growing investments 

in existing manufactured housing communities). 

16 US Census Bureau ACS, supra note 13. Similar results hold for manufactured housing as a proportion of all 

housing stock. 
13 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

MANUFACTURED HOUSING SHARE OF OCCUPIED HOUSING STOCK, BY COUNTY.17 FIGURE 2: 

2.3 Residents of manufactured housing

Certain consumer segments are disproportionately represented among owners and renters of 

manufactured homes, in particular older consumers, consumers that have completed only high 

school, households with relatively low income, and households with relatively low net worth. As 

shown in the top panel of Figure 3, among owner-occupant households, the heads of households 

that lived in manufactured housing are a bit more likely to be younger than 30 or older than 70 

than are site-built owner-occupant household heads. The median age of a head-of-household 

owner of a manufactured home is 53 years, identical to the median owner-occupant head-ofhousehold for all home types.18 The bottom panel of Figure 3 shows that for renters with a head 

 17 US Census Bureau ACS, supra note 13.

18 Id.
14 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

between the ages of 30 and 59, a greater share rented a manufactured home than a site-built 

home.

Nearly one-fifth of households that live in manufactured homes have an older (55 or older) 

single head of household with no children in the home, compared with less than 15 percent of 

households that live in site-built homes.19 A greater proportion of households that live in

manufactured housing are headed by a retiree (32 percent) than site-built households (24 

percent).20

 19 CFPB analysis of Survey of Consumer Finances (SCF), supra note 2.

20 Id.
15 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

 HEAD-OF-HOUSEHOLD AGE DISTRIBUTION21 FIGURE 3: 

 21 US Census Bureau ACS, supra note 13.
16 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

As shown in Table 1, manufactured-home buyers tend to be older at the time of purchase than 

site-built buyers, with a difference in the median age of five years (42 years compared with 37 

years). This age difference is narrower among first-time homebuyers and is wider for repeat 

homebuyers. 

TABLE 1: MEDIAN AGE OF HOUSEHOLD HEAD AT PURCHASE22

All buyers First-time 

homebuyers Repeat buyers

Site-built housing 37 31 41

Manufactured housing 42 33 49

There is significant mobility from site-built housing into manufactured homes—most recent 

purchasers of manufactured homes moved from site-built houses or apartments (where they 

may have previously rented or owned). However, manufactured-home owners are much more 

likely than site-built owners to have moved from another manufactured home. About 20 percent 

of households who recently purchased a manufactured home moved in from a previous 

manufactured home residence. 

Adult residents of owner-occupied manufactured housing tend to have lower levels of 

educational attainment, on average, than adult residents in site-built housing (see Table 2). 

Differences in the distributions of income for home buyers by the type of structure 

(manufactured or site-built) may in part reflect these differences in educational attainment. 

HMDA data for borrowers with purchase-money mortgages taken out in 2012 show that 

households that financed the purchase of manufactured housing had lower incomes on average 

than those who financed the purchase of site-built housing (see Figure 4).23 The percentage of 

purchasers with incomes below $35,000 is higher for manufactured housing than for site-built 

housing.

 22 U.S. Census Bureau AHS, supra note10.

23 Bureau of Consumer Fin. Prot, Home Mortgage Disclosure Act (HMDA) Data 2012, available at 

http://www.consumerfinance.gov/hmda/. The analysis is restricted to only loans secured by an owner-occupied, 1–

4 family property and excludes loans taken out by a business.
17 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

TABLE 2: HIGHEST LEVEL OF EDUCATIONAL ATTAINMENT BY RESIDENTS AGES 25 OR OLDER IN 

OWNER-OCCUPIED HOUSEHOLDS24

High school or 

less Some college College degree or above

Site-built residents 37% 21% 42%

Manufacturedhousing residents

67% 20% 13%

BORROWER INCOME25 FIGURE 4: 

Manufactured-home residents have lower net worth, assets, and debt than other families. The 

2004–2010 Surveys of Consumer Finances indicate that the median net worth among 

households that lived in manufactured housing of $26,000 (in 2010 dollars) was just about onequarter the median net worth of families in site-built homes (Table 3).26 The difference in 

income by type of home for purchase-money borrowers shown in Figure 4 holds more generally 

for all families: median income for families that live in manufactured homes is a bit more than 

$26,000 per year, or roughly half the median income for other families. Families in 

 24 US Census Bureau ACS, supra note13. Note that tables include all residents of owner-occupied housing units.

25 HMDA 2012, supra note23. 

26 CFPB analysis of Survey of Consumer Finances (SCF), supra note 2.
18 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

manufactured homes likewise have lower median assets (about $45,000 compared with 

$213,000 for families in site-built homes) and median debts ($5,000 compared with $30,000

for families in site-built homes). The median ratio of debts to assets, or leverage ratio, is lower 

for manufactured-home residents (15 percent) than for other families (22 percent). 
19 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

TABLE 3: SELECTED FAMILY FINANCIAL CHARACTERISTICS BY TYPE OF HOUSING27

Site-built home Manufactured home

Median net worth (thous. of 2010 dollars) 112.5 26.0

Median annual income (thous. of 2010 dollars) 50.6 26.4

Median assets (thous. of 2010 dollars) 213.2 44.7

Median debt (thous. of 2010 dollars) 30.3 5.0

Median debt-to-asset ratio (percent) 22.1 15.4

Finally, the racial and ethnic profile of manufactured housing residents differs somewhat from 

the profile for those who live in site-built homes. The share of non-Hispanic whites, for example, 

is about seven percentage points greater among those who live in manufactured homes than 

among families in site-built homes (Table 4). Individuals of Hispanic or Latino ethnicity and 

those with American Indian or Native Alaskan racial backgrounds make up a greater share of 

manufactured-home residents than site-built home residents. On the other hand, African 

Americans and Asians account for a smaller fraction of manufactured-home residents than of 

site-built residents.

 27 CFPB analysis of Survey of Consumer Finances (SCF), supra note 2. Figures are in 2010 dollars.
20 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

TABLE 4: RACE AND ETHNICITY DISTRIBUTION FOR US RESIDENTS OF SITE-BUILT HOUSING AND 

MANUFACTURED HOUSING28

Ethnicity/Race Site-built housing 

residents

Manufacturedhousing residents

Hispanic or Latino 16.4% 18.2%

Not Hispanic or Latino 83.6% 81.8%

 Non-Hispanic White 63.5% 69.1%

One Race

 White 74.0% 81.3%

 Black or African American 12.5% 8.7%

 American Indian and Alaska Native 0.8% 1.8%

 Asian 5.1% 0.8%

 Native Hawaiian and Other Pacific Islander 0.2% 0.1%

 Some Other Race 4.8% 5.2%

Two or More Races 2.7% 2.2%

2.4 Housing costs

Manufactured homes typically cost less than site-built homes, both on a square-foot basis and in 

total. Manufactured homes cost less than half as much as the estimated $94 per square foot for 

new site-built housing construction in 2013.29 The average consumer sales price for a new 

single-section manufactured home was about $43,000 in the first six months of 2014, and the 

average price of a new multi-section manufactured home was about $78,000.30 Custom designs

or optional finishes and features can raise a home’s price tag to $100,000 or more. At the lowerend of the price spectrum, the most basic single-section homes can sell for less than $20,000. 

 28 US Census Bureau ACS, supra note13. 

29 MH Census, supra note 3. 

30 MH Census, supra note 3.
21 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

Transport, siting, and construction represent additional upfront costs to the buyer of a new 

manufactured home. Initial set-up costs depend on the physical conditions of the site. 

Installation add-ons such as steps, air conditioning, or patios may increase the price of the home 

by as much as 25 percent. Moreover, electing to site the home on a permanent foundation can 

cost an additional $2,000–$10,000.31 The median combined value of manufactured homes and 

associated land (among households that own the home and the land) is about 42 percent of the 

median value of existing site-built homes in the U.S.32

Consumers may face different costs depending on whether they own or rent the land. About 48 

percent of households that live in manufactured homes own both the home and the land it is 

placed on, about 30 percent rent the land but own the home, and about 18 percent rent both the 

site and land.33 Nationwide, ground rents in non-age-restricted manufactured home 

communities averaged $393 per month as of late 2013.34 Even taking into account the additional 

cost for ground rent particular to some owners of manufactured housing, the ownership costs of 

manufactured housing are lower than an average site-built home in metro and non-metro areas 

(see Table 5). Typical all-in housing costs for manufactured-home owners in non-metropolitan 

areas were over a third less than the costs for households that owned a site-built home in a nonmetro area ($608 compared with $948), and the gap is even wider for those residing within 

metro areas. The monthly cost differences between manufactured and site-built housing were 

narrower among renters in general, and in particular in non-metropolitan areas, where monthly 

rents for manufactured homes were about $100 less than rents for site-built properties ($654 

compared with $551).35

 31Costs may vary based on geographic requirements. Cost estimates provided by various industry participants 

through CFPB outreach.

32 US Census Bureau AHS, supra note 10.

33 Id.

34 Press release, John M. Turzer, JLT & Associates, National Manufactured Home Community Rent Survey 

Summaries, (July 2013), available at http://jltassociates.com/uploads/2013_12_National_Survey_Summary_Press_Release_July_2013.pdf.

35 US Census Bureau AHS, supra note 10. For this calculation, site-built units include single-family detached, singlefamily attached units (e.g., duplexes and townhomes), and multi-family properties such as condominiums and cooperatives. Rental units are defined as both single-family homes and multi-family units, such as apartments, for 

lease.
22 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

TABLE 5: AVERAGE MONTHLY ALL-IN HOUSING COSTS 36

Metro Non-metro

Site-built Manufactured Site-built Manufactured

Owneroccupants $1,505 $686 $948 $608

Renters $992 $676 $654 $551

Some households may prefer manufactured housing over site-built housing because of its cost, 

construction speed, architecture and layout, or other factors. In many areas of the country, the 

decision to live in manufactured housing may also be influenced by the breadth of housing 

options available in the area, especially in less densely-populated regions. However, data from 

the American Housing Survey and American Community Survey do not offer clear support for 

the conjecture that manufactured housing is particularly prevalent in areas with limited 

affordable site-built or rental housing. More specifically, a comparison of the prevalence of 

occupied manufactured homes in U.S. counties and various available measures of local 

affordable housing availability shows no clear correlation between housing availability and the 

proportion of households that live in manufactured homes.37

There is evidence that some households who move into manufactured housing are less satisfied 

with their homes than those who choose to move into site-built housing. These results suggest 

that for at least some households, the choice to live in a manufactured home may be more costdriven than quality-driven. In a nationally representative survey of recent movers, those who 

moved into manufactured housing were significantly more likely to rate their new house as 

 36 US Census Bureau AHS, supra note 10. Housing tenure refers to the housing unit, so manufactured home owners 

who rent their site are classified as owner-occupants.

37 For instance, based on CFPB analysis of ACS data (2008-2012), the share of vacant homes (both manufactured 

homes and site-built) is 14 percent in counties where occupied manufactured housing is least prevalent and 22 

percent in counties where occupied manufactured housing is most prevalent. However, the vacant-for-sale and 

vacant-for-rent rates are about the same across such counties where manufactured housing is more or less prevalent. 

In addition, site-built homes are not significantly more expensive in counties where manufactured housing is more 

prevalent. In counties where manufactured housing is highly prevalent, home values and rents overall tend to be 

lower. A similar result holds when analysis is restricted to non-MSA counties. 
23 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

“worse [than their previous residence]” than similarly situated households who moved into sitebuilt housing.38 This finding is true of lower-income (below 150 percent of the area poverty line) 

manufactured-housing owners in metro areas and for lower-income manufactured-housing 

owners who previously rented. However, for owner-occupant households in rural areas and 

those who had previously owned a home, those moving into manufactured homes were not 

significantly more likely to report their new residences as “worse.” 

2.5 The legal treatment of manufactured 

housing

As noted above, manufactured homes may be titled as either personal or real property. In most 

cases, re-titling of the home as real estate requires that the home must be affixed to a permanent 

foundation on land that is owned by the home’s owner. The process generally involves 

surrendering the original title and providing additional documentation to a county land recorder 

that the home has become a real estate fixture. Since 2004, about one-quarter of new 

manufactured homes were titled as real estate, though in recent years this proportion has 

decreased; in 2013 only 14 percent of new manufactured homes were titled as real property.39 In 

Texas, which received more than 20 percent of all new manufactured homes shipped in 2013, 

about 10 percent of all new manufactured homes and only seven percent of used manufactured 

homes purchased in 2013 from retailers were titled as real property.40

The way in which a manufactured home is titled affects property taxation, applicability of 

consumer protection laws, and financing options.41 To qualify for mortgage financing, a 

consumer must title the manufactured home as real property and encumber both the land and 

 38 US Census Bureau AHS, supra note 10.

39 MH Census, supra note 3.

40 Manufactured Housing Institute, Manufactured Home Shipments by State (1990 - 2013), available at

https://www.manufacturedhousing.org/admin/template/subbrochures/390temp.pdf (Data source: Institute for 

Building Technology and Safety (IBTS)); Texas Manufactured Housing Association, Stats: Payment Types for Retail 

Sales, available at http://www.texasmha.com/industry-resources/stats/payment-types-for-retail-sales.

41 For a discussion of state and federal laws’ applicability to manufactured homes titled as real or personal property, 

see CFED & NCLC, supra note 12. See also Government Accountability Office (GAO), GAO-07-879, Federal 

Housing Administration, Agency Should Assess the Effects of Proposed Changes to the Manufactured Home Loan 

Program (Aug. 2007), available at http://www.gao.gov/new.items/d07879.pdf. 
24 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

home; otherwise, the consumer can obtain only a chattel loan with the lender taking a security 

interest in the manufactured home.42 For this reason, manufactured homes in land-lease 

communities —about 30 percent of all manufactured housing placements in recent years—are 

generally only eligible for chattel financing.43

There are material differences between mortgage financing for manufactured homes and chattel 

financing. To begin with, chattel loans may be priced between 50 and 500 basis points higher, 

all else equal, than a comparable mortgage loan for a manufactured home.44 Additionally, 

chattel loans are also generally for shorter loan terms which affect the monthly costs. On the 

other hand, mortgages for manufactured homes generally have higher costs at origination 

relative to chattel loans (including the cost of recording the mortgage) and generally take longer 

to close than chattel loans. In addition, mortgage loans encumber the land as well as the 

manufactured home whereas the chattel loan gives the lender a security interest only in the 

home. Furthermore, there are specific consumer protection laws that apply only to mortgage 

financing, including parts of the Real Estate Settlement Procedures Act (RESPA) and various 

state foreclosure and repossession laws. Thus, manufactured-home owners who can choose 

either chattel or mortgage financing (generally, those who own the land to which the 

manufactured home is being permanently affixed) may face a tradeoff between lower costs at 

origination and a quicker closing with less collateral, on the one hand, and lower total costs over 

the life of the loan along with greater consumer protections on the other.

As previously noted, the vast majority of manufactured housing stock is titled as chattel and 

thus eligible only for chattel financing. The Bureau estimates that approximately three-quarters 

of all manufactured-home owners with purchase financing take out a chattel loan. According to 

2011 AHS data, about 60 percent of manufactured-home owners who own their home also own 

the land. Among consumers who purchased their home between 2001 and 2010, about 51 

percent owned the land. We estimate based on AHS data that 65 percent or more of land-

 42 In discussing loans for manufactured housing, the term “mortgage” is often used as shorthand for real property 

loans (as opposed to chattel loans).

43 MH Census, supra note 3. Anecdotal evidence and American Housing Survey (AHS) data suggest that an even 

greater share, potentially almost half, of the stock of manufactured homes purchased in recent years are located in 

communities.

44 See Wirtz, supra note 14; industry outreach. 
25 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

owning consumers who took out a home-purchase loan between 2001 and 2010 had a chattel 

loan.45

The extent to which consumers are aware of theses tradeoffs and how consumers weigh them 

remains an open question. It is not clear to what degree upfront costs and convenience, lack of 

availability for mortgage financing, or lack of relevant information about financing options drive 

consumers to chattel financing. Some consumers may not wish to encumber their land in a 

mortgage transaction for reasons other than upfront cost or time, especially if the land is owned 

free and clear or would require partition.

 45 US Census Bureau AHS, supra note 10.
26 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

3. Production, sales, and 

financing

3.1 Historical manufactured housing finance 

market dynamics

Production of manufactured homes increased steadily in the mid-1990s but dropped sharply in 

the late 1990s into the early 2000s. In only four years, annual new manufactured home factory 

shipments dropped to less than half the peak of nearly 375,000 in 1998, to about 170,000 in 

2002. In the late 1990s, a market rapidly grew to finance loans for these homes and securitize 

the underlying manufactured-home loan assets (see Figure 5). The sharp and sustained decline 

in manufactured home purchases after 1998 was driven to a large extent by the collapse of the 

secondary market for manufactured-housing loans after market participants suffered sharp 

losses on securities backed by manufactured-housing loans.46

The manufactured housing crisis was precipitated by behavior similar to that which led to the 

larger subprime and “Alt-A” housing market collapse and financial crisis less than a decade 

later. Manufactured home lending standards, for example, relaxed through the late 1990s as 

lenders provided financing to less creditworthy borrowers. In order to generate origination 

volume, creditors lowered borrower credit standards and documentation requirements. To 

make monthly payments more affordable and qualify more buyers, lenders lengthened loan 

 46 The declining number of shipments and placements might in part reflect slackened demand for manufactured 

homes to the extent that financing for site-built homes became more available during the early 2000s and, 

consequently, buyers that otherwise might have purchased an manufactured home instead purchased a site-built 

home.
27 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

terms. Borrowers from Green Tree Financial, once the largest manufactured-housing lender, 

experienced an increase in average loan terms to 25 years in 1997 from just 13 years in 1987.47

As a result, consumers with longer-term loans built less equity in their homes as principal 

payments were spread over a longer period. Moreover, retailer fraud in the form of artificially 

inflated home appraisals and invoice prices or falsified credit applications was a recognized 

issue as home sales surged.48

FIGURE 5: MANUFACTURED-HOUSING LOAN-BACKED ABS ISSUANCE AND NEW MANUFACTURED HOME 

SHIPMENTS49

The poor quality of many loans for manufactured housing led to high rates of defaults and 

repossessions in the early 2000s. Many consumers who had financed the purchase of a 

manufactured home throughout the late 1990s and early 2000s had difficulty making payments. 

The FHA Title I portfolio saw default rates between 30 and 54 percent on loan vintages 

 47 Alex Berenson, A Boom Built Upon Sand, Gone Bust, N.Y. Times, November 25, 2001, available at

http://www.nytimes.com/2001/11/25/business/a-boom-built-upon-sand-gonebust.html?pagewanted=2&pagewanted=all. 

48 Standard & Poor’s, Manufactured Housing Criteria (Jan., 2000) available at

http://www.securitization.net/pdf/mh99web.pdf. 

49 Asset-Backed Alert, ABAlert.com, 2014; MH Census, supra note 3.
28 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

originated between 1995 and 2002 (as of 2007), and the highest rate of payment defaults came 

within the first three to five years of a loan’s repayment. 50 In the year 2000 alone, over 75,000 

consumers had their homes repossessed, whereas a rate of 20,000 repossessions annually was 

the norm throughout boom years.51 By the end of 2002, repossessed inventory had grown more 

than fourfold since the beginning of 1999 to $1.3 billion.52

As the manufactured housing boom fell from its peak between late 1998 and early 2002, at least 

eight sizable market lenders exited the market. Conseco, Inc., filed for bankruptcy in 2002, four 

years after merging with Green Tree Financial. As the largest manufactured-housing lender with 

54 percent of originations in 2000, Conseco’s bankruptcy reflected the industry-wide trend of 

deteriorating loan quality and drove losses in the secondary market. 

As issuers and purchasers of manufactured housing asset backed securities, including chattel, 

the GSEs sustained large losses within their manufactured housing portfolios. As of 1999, 

Fannie Mae had captured about 24 percent of the overall manufactured housing market and 

subsequently aimed to increase manufactured housing purchases, as one way to meet 

affordable-housing goals.53 Loan vintages from 1999 and later proved to be the worst 

performing as delinquencies and defaults rose well into the next decade.54 Moreover, troubled 

assets represented a significant portion of the GSEs’ manufactured housing portfolio—as of 

October, 2002 Conseco securities represented 70 percent of Fannie Mae’s manufactured 

housing balances.55

 50 GAO, supra note 41.

51 Berenson, supra note 47; Daniel Guido, Manufactured Mess, Builder, (Oct., 2001), available at

http://www.builderonline.com/mortgages-and-banking/manufactured-mess.aspx?dfpzone=magazines.archive. 

52 Wirtz, supra note 14. 53 Fannie Mae internal memorandum, “HUD Housing Goals Options,” June 15, 1999. available at http://fcicstatic.law.stanford.edu/cdn_media/fcic-docs/1999-06-

15%20Fannie%20Memo%20re%20HUD%20Housing%20Goals%20Options.pdf (Memorandum is available in the 

Financial Crisis Inquiry Commission Archives).

54 JPMorgan Global Structured Finance Research, “ABS Performance Statistics,” September 25, 2002. Available at

http://www.securitization.net/pdf/jp_stats_090102.pdf; 

 Wachovia Securities, “Manufactured Housing Loss Severities Remain Stubbornly High,” February 12, 2002. 

Available at http://www.securitization.net/pdf/wachovia_loss_021202.pdf.

55 Fannie Mae internal presentation, “Conseco Manufactured Housing Business Data Gaps Lessons Learned,” March 

24, 2003, available at http://fcic-static.law.stanford.edu/cdn_media/fcic-docs/2003-03-

24%20Fannie%20Mae%20Conseco%20Manufactured%20Housing%20Business-

%20Data%20Gaps%20Lessons%20Learned.pdf
29 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

Many securities backed by manufactured-housing loans were considered to be high credit 

quality by the ratings agencies when the securities were issued and, in turn, by the GSEs that 

relied upon the rating agencies’ assessments.56 This proved problematic as issuances were 

downgraded through the manufactured housing crisis. Freddie Mac halted purchases of 

manufactured housing securities after 2002. In 2002, all of Freddie Mac’s portfolio of 

manufactured housing securities were rated BBB or above; by 2004 over half were rated below 

BBB- .57 Similarly, 99 percent of Fannie Mae’s guaranteed and portfolio manufactured-housingbacked securities were considered investment grade in mid-2003, and this figure dropped to 

three-quarters by mid-2004.58 In mid-2003 Fannie Mae owned or guaranteed $9.1 billion in 

manufactured-housing securities, and by the end of 2004, after substantial impairments, the 

portfolio was valued at just $5.4 billion.59 Issuance of securities backed by manufacturedhousing loans rapidly declined since its peak and has not returned to any great extent since the 

precipitous crash. 

3.2 Size and composition of the financing 

market for manufactured housing

HMDA data from 2012 indicate that loans for manufactured housing represented 2.5 percent of 

all first-lien home-purchase transactions to owner-occupants.60 This figure is likely an 

underestimate of the proportion of manufactured housing finance transactions, given the 

 56 See, e.g., Fannie Mae, Conseco Manufactured Housing Business Data Gaps Lessons Learned (Mar. 24 2003), 

available at http://fcic-static.law.stanford.edu/cdn_media/fcic-docs/2003-03-

24%20Fannie%20Mae%20Conseco%20Manufactured%20Housing%20Business-

%20Data%20Gaps%20Lessons%20Learned.pdf (presentation related that Fannie Mae “relied completely on one 

reference point, the rating agencies” with respect to manufactured housing risk) (available in Financial Crisis 

Inquiry Commission Archives).

57 Freddie Mac Annual Reports, 2003-2004. Available at

http://www.freddiemac.com/investors/ar/pdf/2004annualrpt.pdf ; 

http://www.freddiemac.com/investors/ar/pdf/2003annualrpt.pdf

58 Fannie Mae, Form 10-Q, Quarter ending June 31, 2003; Fannie Mae, Form 10-Q, Quarter ending June 30, 2004, 

available at http://www.fanniemae.com/portal/about-us/investor-relations/sec-filings.html. 

59 Fannie Mae, Form 10-Q: Quarter ending June 31, 2003, available at 

http://www.fanniemae.com/resources/file/ir/pdf/quarterly-annual-results/2004/2004_form10K.pdf

60 HMDA 2012, supra 23. The analysis is restricted to only loans secured by an owner-occupied, 1–4 family property 

and excludes loans taken out by a business.
30 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

current reporting requirements for the data.61 More than 2,000 institutions reported originating 

one or more manufactured housing purchase loans in 2012. HMDA requires data collection for 

dwelling-secured loans made by certain creditors. Loans reported in HMDA include both chattel 

and mortgage loans, but it is not possible to definitively distinguish between these types of 

collateral in the HMDA data. 

Because manufactured housing lending may be considered by some lenders to be a specialty 

niche, many mortgage lenders do not originate chattel loans. Based on conversations with 

industry participants, it appears that the national lending market for chattel loans is 

concentrated among five lenders: 21st Mortgage, Vanderbilt Mortgage, Triad Financial Services, 

U.S. Bank, and San Antonio Federal Credit Union.62 These national chattel lenders accounted 

for over 52 percent of the manufactured-home purchase-money mortgages reported in the 2012 

HMDA data. This likely understates these institutions’ share of the chattel market, as HMDA 

captures both mortgages and chattel loans. For smaller manufactured-housing loans ($50,000 

or less), these lenders represent over three-fifths of HMDA purchase-loan transactions. Other 

chattel lenders include smaller regional or community-based institutions, so the number of 

lenders serving local markets varies.

Manufactured-housing loans are typically smaller than loans for site-built housing. As shown in 

Figure 6, most manufactured-housing purchasers finance between $10,000 and $80,000. The 

median loan amount for site-built home purchase was $176,000, more than three times the 

manufactured home purchase loan median of $55,000. Some of the variability of loan balances 

for manufactured homes comes from the fact that many of the manufactured-housing loans are 

home only, and the loans for site-built properties are for both home and site. Unfortunately the 

HMDA data do not identify loans secured only by the home or by the home and land. Based on 

survey data of consumers, the average manufactured-home buyer who financed a purchase 

 61HMDA likely underreports portions of the manufactured housing lending market since manufactured housing is 

especially prevalent in rural America. Small depository institutions (DIs) and those exclusively in non-metropolitan 

areas are not required to report data for HMDA. Similarly, non-DIs with fewer than 100 purchase-money or 

refinance loans or less than five applications, originations, or purchased loans from metropolitan areas are not 

required to report.

62 21st Mortgage and Vanderbilt Mortgage are wholly owned subsidiaries of Clayton Homes, a Berkshire Hathaway 

corporation and the nation’s largest manufactured housing producer. Triad Financial Services did not report HMDA 

data for the years analyzed in this publication. Another originator with a large share of manufactured-housing loans, 

Wells Fargo, engages primarily in real estate-secured lending for manufactured homes.
31 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

between 2006 and 2010 obtained a purchase loan for $31,000 if they bought the home and not 

the land, and $65,000 if they also owned the land.63

FIGURE 6: LOAN AMOUNT DISTRIBUTION, HOME PURCHASE LOANS FOR MANUFACTURED AND SITEBUILT HOMES64

 63 US Census Bureau AHS, supra note 10. Available data does not allow analysis of landowning consumers who 

financed their home only versus land and home together. 

64 HMDA 2012, supra note 23.
32 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

3.3 Home purchase loan pricing

Manufactured-home borrowers typically pay higher interest rates for their loans than site-built 

borrowers. One illustration of this difference is the greater share of manufactured-housing loans 

that are classified as higher-priced mortgage loans (HPMLs) compared with site-built mortgage 

loans. HPMLs are dwelling-secured loans with annual percentage rates (APRs) at least 150 basis 

points (0r 350 basis points for subordinate liens) over the applicable average prime offer rate 

(APOR).65 The HPML definition was developed as a potential way to identify a set of loans that 

might be considered subprime. The HPML designation may trigger additional consumer 

protections, including rules regarding appraisals, escrows, and loans that qualify for the 

Bureau’s safe harbor Qualified Mortgage (QM) designation.66

Of the first-lien loans reported under HMDA, about 68 percent of manufactured home purchase 

loans in 2012 were higher-priced, compared with three percent of purchase loans for site-built 

homes (Figure 7, top panel). The median rate spread over APOR for all purchase loans for 

manufactured homes (i.e., both HPML and non-HPML loans) in the 2012 HMDA data was 375 

basis points.67 Given that the average APOR for a fixed rate, 20-year loan in 2012 was 3.04 

percent, a typical manufactured-housing loan in that year might have had an interest rate of 

6.79 percent.

Even among the set of HPMLs, manufactured-home loans tend to have higher rates: APRs on 

higher-priced manufactured housing purchase loans averaged 570 basis points greater than 

APOR, whereas APRs on higher-priced site-built purchase loans averaged only 230 basis points 

greater than APOR. 

 65 APOR is computed weekly using data from the Freddie Mac Primary Mortgage Market Survey. Fed. Fin. Inst. 

Examination Council (FFIEC), Rate Spread Calculator, available at https://www.ffiec.gov/ratespread/newcalc.aspx

As described by the FFIEC, APOR is an estimate of APRs offered on prime mortgage loans with a given set of 

characteristics (for example, lock-in date and fixed or adjustable rate).

66See infra Appendix A for more details regarding these and selected other Bureau’s consumer protection rules that 

affect dwelling-secured loans in the Appendix.

67 Note that currently creditors report spread over APOR only for HPMLs. Since the vast majority of site-built loans 

are not HPMLs, it is impossible to compute the median APR over APOR spread for site-built loans using HMDA 

data. Similarly, it is impossible to compute the average APR over APOR spread for both site-built and manufactured 

housing loans. In 2014, the Bureau proposed changes to HMDA that would, among other things, allow researchers 

to analyze the mortgage market, and the manufactured housing segment of that market, more thoroughly. These 

changes include requiring creditors to report the APR over APOR spread on all loans, a field that would indicate 

whether a loan is chattel or real property, and points and fees.
33 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

FIGURE 7: HIGHER-PRICED AND HOEPA HIGH-COST LOANS, SHARE OF PURCHASE LOANS ORIGINATED

BY HOUSING TYPE68

Loans for manufactured homes are also more likely to be classified as “high-cost” loans, as 

defined by the Homeownership and Equity Protection Act (HOEPA). High-cost loans (or 

“HOEPA loans”) are those with an APR or points and fees that exceed certain thresholds. 

HOEPA provides certain protections to consumers that take out high-cost loans, including 

additional disclosures, home ownership counseling, and restrictions on certain loan contract 

terms. The first threshold is based on the loan’s APR and is set at 650 basis points above APOR 

for all first-liens and 850 basis points for junior liens as well as for first-lien personal-property 

loans for less than $50,000. The second threshold is based on points and fees and, in general, is 

five percent of the loan amount, with different thresholds for loans under $50,000. 

The Bureau analyzed 2012 HMDA data to compare first-lien manufactured-home and site-built 

loans that may be considered HOEPA loans. The current HOEPA thresholds described above did 

not take effect until 2013, so this analysis classified loans originated in 2012 as high-cost 

 68 HMDA 2012, supra note 23.
34 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

mortgages as if the new Dodd-Frank APR thresholds had been in place in 2012.69 In addition, 

because the HMDA data do not include points and fees, the analysis is restricted to loans with 

an interest rate that exceed HOEPA’s APR threshold.70

Most loans with rates that exceed the HOEPA APR threshold in HMDA are for manufactured 

homes and, in particular, for home-purchase loans for manufactured housing. Of the roughly 

10,600 first-lien home-purchase, refinance, or home improvement loans reported under HMDA 

with rates that exceed the HOEPA APR threshold, about 10,000 are for manufactured homes. Of 

these, nearly 9,800 are home-purchase loans for manufactured homes.71

In addition, the share of first-lien home-purchase loans for manufactured housing with interest 

rates that exceed the HOEPA APR threshold is considerably greater among those for amounts 

less than $50,000 even though the threshold for loans amount under $50,000 is 200 basis 

points higher than for larger loans. More specifically, considering only first-lien loans for the 

purchase of a manufactured home, about 21 percent of these loans for less than $50,000 have 

interest rates that exceeded the HOEPA APR threshold, compared with about 13 percent for 

larger loans, (amounts of at least $50,000). 

As shown in the lower panel of Figure 7, HOEPA’s additional consumer protections will likely 

apply to a much larger fraction of first-lien home-purchase loans for manufactured housing than 

for site-built housing. In particular, by these estimates, 0.2 percent of all home-purchase loans 

in the U.S. have an interest rate that exceeds the HOEPA APR threshold. This fraction is only 

 69 See infra Appendix A for background information on the HOEPA rule and recent changes. 

70 In this analysis, we use “rate that exceeds the HOEPA APR threshold” as a shorthand to denote loans that have 

APRs in HMDA such that when the loans were made the spread between the APR and APOR is greater than 650 bps 

for loans over $50,000 and is greater than 850 bps for loans that are under $50,000. The analysis is further 

restricted to only loans secured by an owner-occupied, 1–4 family property and excludes loans taken out by a 

business.

71 The HOEPA APR threshold for chattel loans under $50,000 is 850 bps over APOR. For the purposes of this 

analysis, we assume that all first-lien manufactured-housing loans in HMDA with loan amount of under $50,000 

and APR over APOR spread of between 650 and 850 bps are chattel loans. Anecdotal and survey evidence supports 

this assumption. For example, based on evidence from various surveys, the Bureau previously assumed that 75 

percent of manufactured-housing loans in HMDA under $50,000 are chattel loans; however, that proportion is 

likely to be higher for loans that have APR over APOR spread of over 650 bps. Assuming that none of the 

manufactured-housing loans in HMDA with loan amount of under $50,000 and with a spread between 650 and 850 

bps are chattel loans leads to a higher number of manufactured-housing loans that have the spread over the 

threshold: approximately 15,500 instead of 10,000, but does not significantly change other findings in this 

subsection.
35 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

0.01 percent for site-built homes but nearly 17 percent for manufactured homes.72 It is not 

possible from data currently reported through HMDA to assess the extent to which the greater 

share of manufactured housing loans that exceed the HOEPA APR thresholds compared with 

loans for site-built homes is generally attributable to differences in the credit profile of 

manufactured-home borrowers such as credit scores, debt-to-income ratios, loan-to-value or 

other such factors.

FIGURE 8: MANUFACTURED HOME PURCHASE LOANS ABOVE HOEPA HIGH-COST APR THRESHOLD, BY 

LOAN AMOUNT, BASED ON 2012 HMDA DATA73

Based on HMDA data, the majority of these loans with APRs that exceed the HOEPA APR 

threshold for manufactured homes were originated by two creditors—the only creditors that 

originated more than 250 manufactured-home loans for home-purchase in 2012 that have rates 

that exceed the HOEPA APR threshold. These two creditors originated approximately 5,500 and 

 72 The estimated share for manufactured-housing loans falls to about ten percent for all loans (i.e., home-purchase, 

refinance, and home improvement loans). 

73 HMDA 2012, supra note 23. Note that analysis is for first-lien home-purchase loans secured by a 1–4 family 

property, excludes loans to businesses, and considers only the APR threshold; not the points and fees threshold 

because points and fees are not reported in HMDA. The estimate also assumes all loans with APR spreads between 

650 and 850 bps over APR are secured by personal property. Finally, it assumes no lender response to the 

enactment of the HOEPA final rule.
36 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

3,300 home-purchase loans for manufactured homes, respectively, with rates that exceed the 

HOEPA APR thresholds. Together, these originations account for roughly 91 percent of all 

home-purchase loans for manufactured homes in 2012 that have rates that exceed the HOEPA 

APR threshold. In contrast, these two creditors originated 38 percent of the home-purchase 

loans for manufactured homes in HMDA overall. There could be several reasons why the loans 

that these creditors made in 2012 were more likely to exceed the new HOEPA APR thresholds. 

For example, these creditors make a particularly large number of chattel loans. It is also possible 

that these creditors make manufactured-housing loans with differences in, for instance, credit 

scores, collateral, or other borrower characteristics that are not measured in HMDA. 

On top of pricing differences between loans for manufactured housing compared with site-built 

homes, loan rates also differ between chattel and mortgage loans for manufactured homes. 

Borrowers with chattel financing typically pay higher prices than those with mortgage financing 

for a manufactured home. Proprietary data voluntarily provided to the Bureau by some 

manufactured home lenders do not show economically substantial differences in income, debtto-income ratios, credit scores, and loan-to-value ratios between borrowers with chattel loans 

compared to those with mortgage loans. Thus pricing differences may stem, for example, from 

differences in collateral type or differences in other borrower characteristics that are not 

captured in these data. For the lenders in the sample utilized, loan amounts and points and fees 

tend to be about 40 to 50 percent lower for chattel loans, and APRs on chattel loans are about 

150 basis points higher on average than for mortgages on manufactured homes.

The following example illustrates the relative prices of an HPML and a HOEPA loan for a 

manufactured home. Assume that a consumer purchases an average new multi-section 

manufactured home for $80,000, pays 20 percent down and takes out a 20-year fixed-rate loan 

for $64,000. The APOR on a 20-year fixed-rate loan is 3.36 percent as of August 11th 2014. The

principal and interest payments for a $64,000 loan with this term, interest rate of 3.36 percent, 

and no points and fees would be $367 per month. In contrast, a second consumer’s payments, 

for a 20-year, no points-and-fees loan with an interest rate of 4.87 percent – just over the HPML 

threshold of APOR plus 150 basis points – would be $418 per month. A third consumer’s 

payments for a 20-year, no points-and-fees loan with an interest rate of 9.87 percent—just over 

the HOEPA APR threshold of APOR plus 650 basis points—would be $612 per month. See Table 

6 below for an illustration of the preceding example. 
37 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

TABLE 6: EXAMPLE LOAN CHARACTERISTICS AND MONTLY PAYMENTS. POINTS AND FEES ARE NOT 

INCLUDED IN THE TABLE OR THE ANALYSIS. 

Consumer 1: Loan at 

APOR

Consumer 2: Loan at 

HPML APR

Consumer 3: Loan at 

the HOEPA highcost APR

Manufactured home 

price $80,000 $80,000 $80,000

20-year fixed-rate loan 

at 80% loan-to-value $64,000 $64,000 $64,000

Rate 3.36% 4.87% 9.87%

Percentage points 

above APOR 0% 1.50% 6.50%

Monthly payment $367 $418 $618

3.4 Secondary market for manufacturedhousing loans in 2014

Due to the limited secondary market for both manufactured-home chattel and mortgage loans, 

over 70 percent of manufactured-home loans in HMDA are held in portfolio, compared with 

about 16 percent of mortgages for site-built homes.74 The secondary market for manufacturedhousing loans differs markedly from that for site-built. For example, the GSEs purchase a 

substantial share of site-built loans originated in any given year but only a tiny fraction of 

manufactured-housing loans, at least in part because their involvement is limited to loans 

secured by real property. 

 74 HMDA 2012, supra note 23. The analysis is restricted to only loans secured by an owner-occupied, 1–4 family 

property and excludes loans taken out by a business.
38 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

The vast majority of HMDA-reported manufactured-housing loans held in portfolio were 

higher-priced (82 percent), and their average loan amount was about half that of loans sold on 

the secondary market ($52,600 and $104,500, respectively). It is likely that most of the loans 

held in portfolio are chattel loans, for which secondary market demand has been depressed over 

the last decade.

Though the GSEs play a much smaller role in the secondary market for manufactured-housing 

loans than in the market for site-built loans, government programs exist to facilitate 

manufactured housing lending. 17 percent of manufactured-housing loans for home purchase in 

2012 were guaranteed by Ginnie Mae for sale in the secondary market, eligible by virtue of 

origination under Federal Housing Administration (FHA), Department of Veterans Affairs (VA) 

or the U.S. Department of Agriculture’s Rural Development (RD) lending programs.75

Recognizing the “prolonged downturn” in the manufactured home industry, Congress passed 

the FHA Manufactured housing loan Modernization Act in 2006.76 The law mandated changes 

to FHA’s Title I program, which covers home-only (chattel) purchase loans for manufactured 

housing, to remove impediments to Ginnie Mae securitization of such loans. FHA-guaranteed 

loans constituted about a fifth of manufactured-housing loans for home purchase in 2012, 

whereas VA and RD loans together amounted to less than five percent. The FHA has two 

programs for manufactured home purchase lending, one each for real and personal propertysecured lending. The credit requirements for FHA chattel borrowers are less stringent than for 

mortgages, though lenders are required to retain more credit risk under the Title I chattel 

program, as shown in Table 7 below. Accordingly, Ginnie Mae now operates a home-only (FHA 

Title I) chattel loan guarantee program. Only one issuer was active in the space as of early 2014, 

largely due to a lack of investor demand. In 2012 Ginnie Mae was the most active secondary 

market participant for all manufactured-housing loans, although almost exclusively through 

their single-family mortgage-backed securities program.

 75 HMDA 2012, supra note 23.

76 Comm. on Fin. Servs., Report on H.R. 2139, FHA Manufactured Housing Loan Modernization Act,, H.R. Rep. No. 

110-206, (2007).
39 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

TABLE 7: MANUFACTURED HOME ELIGIBILITY REQUIREMENTS FOR FHA TITLE I AND II PROGRAMS77

FHA Title I FHA Title II

Personal property Real estate, permanent foundation

Land only, land/home, or home only; site can 

be leased

Unit and land only; site must be owned and 

titled as real estate

Loan limits:

MH only: $69,678

Lot only: $23,226

Combination: $92,904

FHA site-built limits apply: $271,050-$625,500 

by area

5% down if credit score is 500+

10% down if credit score is <500

Like FHA site-built requirements:

3.5% down

Or 10% if credit score is <580

FHA insures maximum 90% of loan Insures all of loan loss

3.5 Production of manufactured housing

As discussed above, the manufactured housing secondary market experienced a crisis in the 

early 2000s. The last decade has not seen a recovery in manufactured home production and 

retail industries. Instead, manufacturers have gone out of business or consolidated: compared to 

approximately 88 manufactured housing producers in the U.S. in 2002, around half that many 

are active in the space today. Some of this consolidation is due to large national manufacturers’ 

purchases of failing manufacturers but a fragmented market with dozens of smaller regional 

manufacturers remains today. Production remains 15 percent lower than the overall peak in 

1998 when production exceeded 373,000 units before it declined through the 2000s.78 Since 

2009, however, shipments have showed slight but steady gains. Early data from 2014 indicate 

year-over-year growth continues–in the first six months of 2014, shipments were up 5.6 percent 

over the same period in 2013.

 77 Federal Housing Administration.

78 MH Census, supra note 3.
40 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

The largest three manufacturers held almost 70 percent market share of new manufactured 

housing production as of the end of 2013. Clayton Homes, a subsidiary of Berkshire Hathaway, 

has been the largest manufacturer by market share for over a decade, with home production 

share of 45 percent as of the end of 2013.79 Other large national and regional manufacturers 

include Cavco Industries, Champion Home Builders, Legacy Housing, and Skyline Corporation. 

Currently the producers of manufactured homes in the U.S. operate 125 production line sites

located across the country.80 Outside of the top three manufacturers, none of the remaining 

corporations hold market share greater than five percent, and they average just over one

production line each.81

FIGURE 9: SHIPMENTS OF NEW MANUFACTURED HOMES. MONTHLY, SEASONALLY ADJUSTED, JANUARY 

2009-JUNE 201482

3.6 Retail

The manufactured housing retail industry consists of dealerships which sell new and used 

manufactured homes to consumers through retail storefronts. The retailer segment is highly 

fragmented and new entrants are rare. Manufactured-housing retailers are typically small, 

 79 MHI and Institute for Building Technology and Safety (IBTS), Inc., supra note 40. 

80 Id.

81 Id.

82 MH Census, supra note 3.
41 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

independent businesses with one or several locations, though few have more than ten sales 

centers. In addition to selling through a network of independent retailers, the largest few 

manufacturers maintain company-owned networks of stores, ranging from a few regional

outlets to a nationwide presence of hundreds. Even among retailers within a manufacturer’s 

owned or affiliated network, it is far more common for a retailer to carry homes from multiple 

lines than to exclusively sell one manufacturer’s models. In general, retailers utilize a floor plan 

line of credit to purchase inventory. The wholesale lender is paid back with the proceeds from 

the sale, either paid in cash by the buyer or financed and paid by the creditor, and the retailer 

generates profit on the home sale’s margin. Retailers are typically obligated to oversee the 

transport and proper installation of the home on site after it is built and transported. 

A consumer’s visit to a manufactured housing retailer may resemble a car-buying experience 

more than a typical site-built home-buying experience in that the consumer may make a 

purchase decision in a sales lot displaying model new homes alongside pre-owned homes for 

sale. Moreover, as with auto financing, a consumer choosing to finance the purchase of a 

manufactured home often submits home loan applications while shopping at the retailer. 

Manufactured-housing buyers seeking financing at a retailer may be constrained by particular 

relationships between retailers and home lenders. Most large national chattel lenders require 

independent retailers to enter into non-exclusive contractual agreements in order for the 

retailers’ customers to be able to access the lender’s financing; these lenders will not offer loans 

to consumers shopping outside of their network of partner retailers. In order for a consumer to 

purchase a home from a particular retailer with financing from a particular lender, the retailer 

and lender must first agree to conduct business together. If a particular lender and retailer do 

not have an agreement, a consumer must try to obtain financing from a different local or 

national lender willing to finance purchases from that retailer or purchase a home from a 

retailer approved by the lender. Smaller regional or local lenders which engage in chattel lending 

for manufactured homes on a more limited basis may not require specific agreements. 

The prevalence of retailer-lender contractual agreements arose out of the particular incentive 

structure involved with manufactured housing sales and financing. The funding model allows a 

retailer to be paid for the home sale before the installation is completed. Agreements with 

retailers give lenders leverage during this period, decreasing the risk that quality issues in the 

completion of the installation cause a consumer to walk away from a home. Additionally, at least 

one national lender’s retailer agreement obliges retailers to periodically sell homes owned by the 

lender on consignment. According to a Government Accountability Office report, having a good 

network of retailers to resell manufactured homes contributes to higher lender recovery rates on 
42 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

foreclosed homes; a strong recovery program could net a 50 percent recovery rate.83 In general, 

a retailer’s goal of selling homes provides incentives for the retailer to partner with lenders to 

offer financing options to potential home buyers. However, a retailer may choose not to partner 

with a certain lender if the retailer believes its market does not fit the lender’s risk profile, or if 

terms of the contract are deemed disagreeable.

3.7 Manufactured home communities

There are about 60,000 land-lease manufactured home communities in the US.84

Manufactured-home communities lease plots of land to owners or renters of manufactured 

housing. Residents of manufactured-home communities most often have equity in their home 

but pay monthly ground rent for the home’s site and fees for common services. The community 

business model is built around revenue generation from ground rents, though community 

operators may also sell or rent new or pre-owned homes directly to consumers.

The industry of manufactured-home community owners is highly fragmented and populated 

with many single-site operators. The largest land-lease community owners include publicly- and 

privately-held Real Estate Investment Trusts (REITs) and property investment firms as well as 

specialty institutional investors. The largest publicly-held portfolio of manufactured-home

communities is owned by Equity LifeStyle Properties, a Chicago-based REIT, and consists of 201 

community properties with over 70,000 manufactured-home and park model home sites.85

The industry has been marked in recent years by consolidation, as growth has been focused on 

existing communities; investors have pursued acquisitions of both single-site operators and 

larger portfolios of manufactured-home community assets. One large community operator with 

over 50,000 sites in 161 communities noted in 2014 that the average length of time that a home 

resides in their communities is 40 years, while the average resident tenure is 13 years, indicating 

 83 GAO, supra note 41. 84 Housing Assistance Council, Preserving Affordable Manufactured Home Communities in Rural America: A Case 

Study, March 2011, available at http://www.ruralhome.org/storage/documents/rcbi_manufactured.pdf. 

85 See Equity LifeStyles Properties, 2014Q2 Investor Presentation, available at http://phx.corporateir.net/phoenix.zhtml?c=105322&p=irol-presentations. 
43 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

that multiple owners cycle through the same home within such communities.86 Some 

communities support community occupancy by offering in-house lending to prospective

manufactured-home buyers, either through the community’s line of credit or a partner lending 

institution. In other cases, a consumer may purchase a home and select a community separately. 

Lot size availability in part determines home choice when a manufactured-home owner wishes 

to place a new home or move a pre-owned home to a community site. 

In various manufactured-home communities around the country, residents have collectively 

purchased land from former operators in order to establish resident-owned communities 

(ROCs). This model was pioneered by groups with non-profit organization support in New 

Hampshire, where a fifth of communities are now resident-owned.87 ROCs operate within a coop shared equity model. In this model, a co-op member pays a monthly fee for the cost of shared 

services, utilities, or amenities plus their share of the cost of debt servicing for the initial land 

purchase. Generally, if and when individual co-op members decide to sell their property, they 

receive back their equity in the land with no appreciation.

 86 See Sun Communities, Inc., June 2014 Investor Presentation, available at

http://www.suncommunities.com/Investors.aspx. 

87 See ROC USA, Background, available at http://www.rocusa.org/about-us/background/default.aspx. 
44 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

4. Conclusion

This white paper provides background on manufactured housing and families that live in 

manufactured homes and highlights differences between manufactured housing and site-built 

homes along these dimensions. Among the most important of these differences is their legal

treatment. Site-built homes are nearly always titled as real estate property, whereas many 

manufactured homes may be titled as either real estate property or personal property (chattel), 

even if the manufactured-home owner owns the land the home is sited on. Chattel loans may 

close more quickly than or have lower upfront costs than loans secured by real property, but 

chattel loans tend to have higher interest rates and provide borrowers with lesser consumer 

protections than mortgages secured by real property. 

The findings also indicate the potential importance of manufactured housing as a source of 

affordable housing for some consumers. Families that live in manufactured-homes, for example, 

tend to have lower income and net worth than families in site-built homes, and manufactured 

homes are generally less expensive than site-built homes. Families in rural areas are also 

relatively more likely to live in manufactured homes, and in some counties as much as one-third 

or more of homes are manufactured homes.

This white paper brings together data and information on manufactured housing from a variety 

of sources to develop a more-complete and current picture of manufactured housing. The 

Bureau will continue to analyze facets of manufactured housing markets and to consider new 

data that may help to further fill in this picture. The relative scarcity of data on manufactured 

housing compared with data available on site-built housing and mortgage finance in general 

remains a challenge for research related to manufactured housing. This gap in data availability 

may begin to narrow, however, in the coming years. The Bureau is considering, for example, 

adding a field to the HMDA data that would indicate whether a manufactured-housing loan is 

secured by real or personal property. Further, additional sets of five-year estimates from the 

ACS will provide larger sample sizes that may support in-depth analyses. The Bureau hopes that 

this white paper and analysis of additional data will encourage others to build greater knowledge 
45 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

of the manufactured housing market, the consumers in that market, and the differences between 

the site-built and manufactured housing markets as well.
46 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

APPENDIX A:

Recent changes to consumer 

financial protection laws and 

their potential impact on 

manufactured housing

Transactions involving manufactured housing have long been covered by several laws designed 

to protect consumers in financial transactions. However, title XIV of the Dodd-Frank Act

recently amended existing laws to expand consumer protections in mortgage (both land and 

home and chattel) transactions. These expanded protections were implemented by the CFPB in

a series of rules which took effect in January 2014. This appendix looks at some of the major

provisions of the CFPB’s rules and their potential impact on manufactured-housing loans.

Homeownership and Equity Protection Act 

(HOEPA)

In 1994 the Home Ownership and Equity Protection Act (HOEPA) was enacted as part of the 

Truth in Lending Act (TILA) to provide certain protections to consumers in high-cost 

transactions involving their homes, including manufactured homes.88 Regulation Z implements 

HOEPA and TILA. A mortgage is subject to HOEPA if it is a high-cost mortgage (commonly 

called a “HOEPA loan”) because of a comparatively high interest rate or points and fees. Among 

 88 TILA’s Regulation Z’s coverage generally extends to loans secured by manufactured homes regardless of whether 

the homes are titled as personal or real property. See, e.g., 15 USC 164x (w), “dwelling means a residential structure 

or a mobile home...”; see also 12 CFR part 1026, Supp. I, paragraph 2(a)(17), 
47 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

other requirements for a HOEPA loan, the creditor must provide additional disclosures to the 

consumer, and certain loan terms such as negative amortization, and rate increases following 

default are restricted. 

Prior to the enactment of the Dodd-Frank Act, HOEPA did not apply to loans for home 

purchase.89 In Dodd-Frank, Congress extended HOEPA to home purchase loans and amended 

HOEPA’s APR triggers so as generally to cover first liens with an APR greater than APOR plus 

650 basis points and junior liens with an APR greater than APOR plus 850 basis points.90

Dodd-Frank also lowered the points and fees triggers to five percent for most mortgages, with 

some adjustment for smaller loan amounts as discussed below.91 Together, the Dodd-Frank 

changes likely increased the share of manufactured-home loans that are classified as HOEPA

loans substantially.92 Congress also added new protections for consumers taking out HOEPA 

loans, including a requirement for pre-loan housing counseling.

Recognizing that loans for smaller amounts are more costly to originate (in percentage terms), 

Congress made certain adjustments to HOEPA’s triggers. Dodd-Frank adjusted the HOEPA 

points and fees threshold for loans less than $20,000. As amended, HOEPA establishes a points

and fees threshold of the lesser of eight percent of the total transaction amount or $1,000. 

Congress also recognized that smaller chattel loans require a higher rate-spread threshold. For 

personal property loans under $50,000, HOEPA applies if the loans have an APR greater than 

APOR plus 850 basis points (instead of APOR plus 650 basis points). The vast majority of these 

personal property loans are for manufactured homes.

In their comments during the HOEPA rulemaking process, some industry commenters stated 

that these adjusted HOEPA thresholds were still too low. They stated that they would not make 

HOEPA loans and therefore consumers would experience reduced access to credit for 

manufactured-home loans. Some large manufactured-housing creditors urged the Bureau to 

establish an APR threshold of APOR plus 1,000 or 1,200 basis points. Such a threshold would 

 89 HOEPA also did not apply to open-end home-secured transactions before the Dodd-Frank Act expansion. 

90 Prior to Dodd-Frank, a first lien loan was covered if its APR exceeded the yield on comparable Treasury securities 

by more than 800 basis points (or by more than 1000 basis points for subordinate lien loans).

91 Prior to Dodd-Frank, the points and fees threshold was the greater of eight percent of the total loan amount, or a 

dollar figure adjusted annually for inflation. In 2013, the dollar figure was $625.

92 Dodd-Frank also added a pre-payment penalty trigger. Under the Dodd-Frank amendments a loan is covered by 

HOEPA if the loan contains a penalty for prepaying the loan in whole or in part, even if the loan’s APR or points and 

fees do not exceed the thresholds discussed above.
48 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

mean that a 20-year fixed-rate loan is covered by HOEPA if its APR is about 13.4 to 15.4 percent, 

based on APOR as of August 11, 2014. The industry also suggested that the points and fees 

threshold should be restored to its pre-Dodd-Frank level at eight percent of the total loan 

amount. A few large manufactured-housing creditors argued that without such adjustments, 

roughly one-third to one-half of their manufactured housing would be classified as HOEPA 

loans based on the APR threshold, and about one-quarter to nearly one-half of these lenders’ 

loans would be classified as HOEPA loans based on the points-and-fees test.

Notwithstanding these arguments, the Bureau decided to implement the statute as Congress had 

written it, rather than use its authority to make adjustments beyond those that Congress 

deemed appropriate. In part this was because of uncertainty as to whether, in fact, a substantial 

number of creditors would cease making manufactured-housing loans if those loans triggered 

HOEPA protections. Moreover, the Bureau reasoned that the manufactured housing borrowers 

being charged interest rates or upfront fees above the HOEPA thresholds are the very 

populations that HOEPA is designed to protect. 

High-cost mortgages—those that exceed HOEPA’s APR or points-and-fees thresholds—have 

historically represented a small share of loans for manufactured homes and for site-built homes. 

On average in the 2004–2011 HMDA data, about 0.2 percent of home-secured refinance and 

home-improvement loans (the types of mortgages covered by HOEPA prior to 2014) were 

classified as high-cost mortgages. This fraction had generally declined since 2004 and was 0.06 

percent in the 2011 HMDA data. The extension of HOEPA to home-purchase loans increased the 

share of all loans (i.e., home-purchase, refinance or home improvement loans) that are classified 

as HOEPA loans, but the resulting increase in the share of high-cost mortgages was much larger 

for manufactured-housing loans than for loans on site-built homes.

The Bureau’s estimate of the share of loans with rates that exceed the HOEPA APR threshold is 

intended to be illustrative. Focusing on only loans that would be high-cost mortgages based on 

APR alone understates the fraction of loans that might be classified as high-cost mortgages, as 

some loans may have rates that do not exceed the HOEPA APR threshold but points and fees 

that exceed the HOEPA points and fees threshold. At the same time, the retrospective analysis 

included in section 3.3, “Home purchase loan pricing,” above may be overly inclusive because it 

does not take into account a creditor’s ability to structure a loan’s interest rate and upfront costs 

in a way that does not reduce the loan’s profitability but ensures that the loan is not classified as 

a high-cost mortgage. Similarly, the estimate does not account for the cases in which creditors 

may choose to reduce a loan’s profitability simply to avoid making a high-cost mortgage loan. 

Specifically, a creditor that would have originated only a handful of HOEPA loans might prefer 
49 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

to restructure those loans, even at a reduced profit, to avoid HOEPA coverage altogether. 

Indeed, some large creditors report performing such a trade-off, effectively lowering some 

consumers’ APRs so as not to exceed the threshold.

Finally, the Bureau is aware that a large manufactured-housing creditor, 21st Mortgage, recently 

indicated that it will stop originating loans for less than $20,000. According to the HMDA data, 

21st Mortgage originated less than 1,500 of such loans in 2012, and there were only a handful of 

counties where more than 20 manufactured-housing loans for less than $20,000 were 

originated in 2012 and 21st Mortgage originated the majority of manufactured-housing loans 

under $20,000.

Qualified Mortgage (QM) and Ability-toRepay (ATR)

In 2010, the Dodd-Frank Act amended TILA to require that, before making a residential 

mortgage, a creditor must make a “reasonable and good faith determination based on verified 

and documented information that, at the time the loan is consummated, the consumer has a 

reasonable ability to repay the loan.” 93 The Act establishes a private cause of action if a creditor 

violates this ability-to-repay requirement. The ability-to-repay requirement sets forth certain 

requirements for loans secured by dwellings, including that the creditor verify the consumer’s 

ability to repay the loan. For a loan that meets the criteria for a qualified mortgage (“QM”), the 

creditor is presumed to have complied with the ATR requirement. The QM criteria include, 

among other things, a three percent limit on points and fees, with higher points and fees limits 

for loans of $100,000 or less. Under the CFPB’s implementing regulations, QMs with APRs that 

do not exceed APOR by 150 basis points or more provide a conclusive presumption of 

compliance with the ability-to-repay rules, and the creditor enjoys a safe harbor from potential 

 93 In 2008, the Federal Reserve Board issued amendments to Regulation Z which required a creditor to make an 

ability to repay determination, but this requirement only applied to loans deemed to be “higher-priced” mortgages—

i.e., loans with APRs that exceeded APOR by 150 basis points (or 350 basis points for subordinate liens). Under the 

Federal Reserve Board’s rules, creditors could obtain a rebuttable presumption of compliance with the ability to 

repay requirement if they met the rule’s criteria for the presumption. These rules applied to manufactured-housing 

loans that met the “higher-priced” APR trigger. In 2010, Dodd-Frank essentially extended the ability to repay 

requirement to all mortgage loans, not just higher-priced mortgage loans, effective in January 2014 when the 

CFPB’s implementing regulations took effect.
50 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

ATR liability. For QMs with rate-spreads that exceed APOR by 150 basis points or more, the 

presumption is subject to rebuttal under narrowly-defined criteria (rebuttable presumption 

QM).94

Note that small creditors are eligible to originate QMs with more flexible criteria. For instance, 

the rate spread threshold for a safe harbor small creditor QM is 350 basis points. Small creditors 

are defined as creditors that originated 500 or fewer first lien mortgages in the previous year 

and have an asset size of less than two billion dollars. 

The previous section noted that some manufactured-home loans are likely to be covered by 

HOEPA’s new APR threshold of more than 650 basis points over the applicable APOR. Note that 

a loan with a rate spread that exceeds HOEPA’s threshold may still be a QM provided that all of 

the QM criteria are met. However, such a loan will also exceed the threshold for the QM safe 

harbor (whether 150 or 350 basis points, depending on whether the creditor is small) and thus 

will be a rebuttable presumption QM. For manufactured-housing loans that trigger HOEPA due 

to points and fees exceeding the HOEPA thresholds, such loans would exceed the three percent 

points and fees limit for QMs and thus would be non-QM loans. 

To the extent manufactured-housing loans are subject to HOEPA, then, they also necessarily are 

either rebuttable presumption QMs or non-QMs, depending on whether they come under 

HOEPA coverage via the APR test or the points-and-fees test. However, creditors have some 

degree of flexibility to trade off as between points and fees and interest rates (and thus APRs). 

Accordingly, they may be able to control for which of these two results they encounter; 

presumably, assuming creditors prefer rebuttable presumption QMs to non-QMs, 

manufactured-housing creditors may shift their overall loan pricing out of points and fees and 

into interest rates to the extent feasible.

 94 For subordinate lien loans, the rate spread for a safe harbor QM is 350 basis points. Note that for loans that are not 

qualified mortgages, there is no presumption of compliance with the ability-to-repay requirement. If a consumer 

can prove that a creditor failed to comply with the ability-to-repay requirement, the consumer may be able to 

recover damages provided for in TILA. 
51 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

Loan-Originator Compensation

In recent years, regulators and lawmakers have imposed a number of new requirements 

concerning loan originators’ licensing and registration, training, screening, and compensation 

practices. In 2010, the Dodd-Frank Act adopted new requirements that built on some of these 

earlier initiatives. In defining loan originators who would be subject to the requirements, 

Congress provided that an employee of a manufactured home retailer is not a loan originator if 

the employee does not take applications and does not advise about, offer, or negotiate loan 

terms. The Bureau issued regulations to implement the new Dodd-Frank Act requirements in 

January 2013 and issued further amendments in September 2013 (the Bureau’s Loan Originator 

Rule). The regulations expand upon and refine earlier regulations adopted by the Federal 

Reserve Board (that became effective in April 2011 and were restated by the Bureau in 

December 2011) to restrict certain compensation practices. The regulations also implement 

Dodd-Frank Act requirements concerning loan originator qualifications that build upon existing 

requirements under the Secure and Fair Enforcement for Mortgage Licensing Act of 2008 

(SAFE Act).

The Loan Originator Rule limits creditors’ ability to pay loan originators (LOs) compensation 

that is based on the terms of the loan. The Bureau implemented Congress’s definition of loan 

originator, including the provision specifically relating to employees of manufactured home 

retailers noted above. The Bureau has clarified the instances when a manufactured-housing 

retailer’s employees would not be considered individual loan originators. A manufacturedhousing retailer’s employees are not considered loan originators if they do not take a consumer 

credit application, offer or negotiate credit terms, or advise a consumer on credit terms. They 

are considered loan originators if they engage in loan originator activities such as referring 

consumers to a particular creditor, filling out a consumer’s loan application, or inputting a 

consumer’s information into an online loan application.

Advising consumers about a loan application and referring consumers to a creditor are LO 

activities, and many manufactured-housing retailers do not want to incur the cost of becoming a 

licensed LO. Thus, retailers report that, instead of referring a consumer to a particular creditor 

or two, they currently do not advise consumers about which creditors are most likely to accept 

their applications. As a result, industry participants have stated that consumers are applying to 

more creditors than before. While this is not per se contrary to the purposes of the rule – in fact, 

increased consumer shopping generally is a positive development – this dynamic also results in 

consumers in the current credit environment applying to creditors who are almost certain to 
52 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

reject their applications. For example, a consumer with a credit score of 550 may apply to a 

creditor that originates loans only to consumers with credit scores over 680. In turn, this results 

in more volume of applications for creditors, all of which need to be processed in a timely 

manner and at least some of which necessarily will be rejected. It follows that two of the effects 

of the Bureau’s Loan Originator rule is a small cost increase to creditors that would have to 

spend more employee time screening applications and an increase in the rejection rates of 

consumers’ applications due to consumers submitting more applications.

The classification of some manufactured-housing retailer activities as loan originator activities 

provides consumer protection for homebuyers in what may be a high-pressure sales 

environment. As a result of the Loan Originator Rule and state SAFE Act provisions, consumers 

who purchase their dwellings through manufactured-housing retailers no longer face pressure 

(from compliant retailers) to finance their purchase through a particular creditor; rather, 

consumers are more likely to shop and compare credit offers. The Loan Originator Rule enables 

consumers to know that the retailer from whom they purchase a manufactured home does not 

steer them to a particular creditor or mishandle their application. Consumers can trust that a 

retailer who advises them on specific credit terms is qualified and licensed to do so. 

Higher-Priced Appraisals

The Dodd-Frank Act made amendments to TILA to impose special appraisal requirements for 

certain higher-priced mortgages that do not meet the Bureau’s definition of QM. Dodd-Frank 

requires an in-person appraisal for properties securing higher-priced mortgage loans. The 

Bureau and five other Agencies authorized to implement this requirement recently finalized a 

supplemental proposal that addressed issues related to manufactured housing.95 The underlying 

concern was that many of the traditional appraisal methods would not be applicable or are not 

currently practiced in the manufactured housing market, especially for chattel transactions. The 

Bureau and the other Agencies adopted a tailored approach to the appraisal requirement for

manufactured homes, with requirements that depend on the type of transaction (specifically, 

new real estate, used real estate, new chattel, and used chattel transactions), ensuring a 

 95 78 Fed. Reg. 78520 (Dec. 26, 2013).
53 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

smoother transition to the new regime. For most of these transactions, the rule is not going to 

become effective until 2015. There is also a smaller-dollar loan exemption in this rule. 

This rule is designed to give borrowers vital information about their mortgage: the value of the 

home (including the land, where applicable). The rule exempts transactions secured by a new 

manufactured home and land from the requirement that the appraisal include a physical 

inspection of the interior of the property. Transactions secured solely by a manufactured home 

and not land will be exempt from the appraisal requirement if the creditor gives the consumer 

one of three types of information about the home’s value. Given these exemptions, the smallerdollar exemption, and the exemption for QM loans (both safe harbor and rebuttable 

presumption), this rule is unlikely to be burdensome to comply with.

Higher-Priced Escrows

In 2008, the Federal Reserve Board issued amendments to Regulation Z which required a 

creditor to establish an escrow account for any higher-priced loan secured by a first lien on a 

principal dwelling.96 The Dodd-Frank Act made two major amendments to TILA with regards to 

escrow requirements for higher-priced loans. First, the Dodd-Frank Act required that the escrow 

account to be established for five years instead of one. Second, the Dodd-Frank Act authorized 

the Bureau to provide an exemption for small rural creditors.97 The Bureau defined small 

creditors as for the purposes of QM designation (see above), while rural was defined as a 

creditor that makes more than half of its loans in rural or underserved areas.98

An escrow account provides borrowers protection from sudden shocks from tax and home 

insurance payments. The Bureau’s rule extends that protection from one year to five while 

reducing access to credit concerns created by this requirement in rural or underserved areas.99

Since most of manufactured housing loans are HPMLs, the Federal Reserve Board’s rule likely 

 96 73 Fed. Reg. 44522 (July 30, 2008).

97 Dodd-Frank Wall Street Reform and Consumer Protection Act, Pub. L. No. 111-203, § 1461 – 1462, 124 Stat. 1376 

(2010).

98 See Paul Mondor, Bureau of Consumer Fin. Prot., Final list of rural and underserved counties for use in 2014, 

CFPB Blog, available at http://www.consumerfinance.gov/blog/final-list-of-rural-and-underserved-counties-foruse-in-2014/ for the list of counties that were defined as rural or underserved for 2014.

99 78 Fed. Reg. 4726 (Jan. 22 2013).
54 MANUFACTURED-HOUSING CONSUMER FINANCE IN THE UNITED STATES

imposed its requirements on most manufactured housing creditors. However, the Bureau’s rule 

provided some relief for small manufactured housing creditors predominantly operating in rural 

or underserved areas. The Bureau believes that extending the escrow account protection from 

one year to five was not burdensome for the remaining creditors.