Dec. 5, 2018
McLEAN, Va. – Dec. 4, 2018 – Freddie Mac announced a new loan product for manufactured housing as a way to boost the U.S. supply for affordable homes.
Freddie says its CHOICEHome conventional financing for manufactured housing will help increase the availability of quality affordable homes by providing lenders with the innovative financing options they need. Manufactured homes can deliver quality at prices up to 50 percent less per square foot than conventional site-built homes.
"Finding a home is more difficult than ever because of the ongoing housing supply shortage in many parts of the country, especially when looking for a home at a lower price point," says Mike Dawson, vice president of Single-Family Affordable Lending Strategy and Policy at Freddie Mac. "Currently there are more than 22 million families living in factory-built housing, and with that number expected to grow, there's an opportunity for factory-built homes to address the housing supply shortage and quality housing overall. This new generation of manufactured housing might just be the best option for first-time homebuyers, millennials, and empty-nesters looking to downsize."
Freddie Mac is conducting a two-year CHOICEHome pilot to bring conventional loan financing to factory-built homes. These homes have features such as permanent foundations and pitched roofs. Many of these homes also come with energy-saving features like Energy Star Qualified Low-E windows, programmable thermostats and minimum insulation values.
Freddie Mac will treat loans secured by CHOICEHome like loans secured by single-family site-built homes. If a factory-built home meets certain specifications, it will be granted a CHOICEHome certification and be eligible for CHOICEHome financing that includes many Freddie Mac conventional loan products, including HomeOne and Home Possible mortgages.
Appraisers will be able to use site-built housing as a comparable for valuation.
Manufacturers and lenders must follow HUD-code guidelines for the home construction and siting of the home in order to meet CHOICEHome eligibility, and lenders must follow local and state guidelines for manufactured housing titled as real property.
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