Ask an RU: Any Updates to Manufactured Housing Requirements?

Manufactured housing requirements have certainly seen some revisions since we last covered this topic in 2020! We’ve seen significant improvements to single wide manufactured housing and HUD data plate and certificate label guidelines. But how will these updates impact you and your customers?

With over 20 million Americans living in manufactured homes and this number growing each year, it’s important to stay on top of any new or updated GSE requirements. After all, you and your borrowers may have questions regarding eligibility, but we’re here to help you stay in the know.

That’s why our own Amy Hopkins, Regional Underwriter, provides insight into some valuable updates made to the GSEs’ manufactured housing requirements. Don’t miss the latest key topics to keep you and your borrowers prepared!

What are manufactured homes again?

In case you need a refresher, manufactured homes are permanent residences that are factory-built and then installed on a lot. Manufactured homes are built in a controlled environment and facility. They are built to be very solid and for longevity, with the intention of being very high quality.

They’re a great financial alternative for hopeful homeowners because, according to the Manufactured Housing Institute, new manufactured homes cost less than 1/3 of the price of homes built on-site. As a result, they’re a popular property type in the affordable housing arena.

True and false statements on manufacturing housing

Our blog focus is on the recent updates made to GSE manufactured housing guidelines, specifically single wide manufactured housing and HUD data plate and certificate label guidelines. Before we dive into the GSE guidelines themselves, check your knowledge with these true and false statements on manufactured housing!

• TRUE – Any manufactured home built prior to June 15, 1976 was not required to be built to HUD codes.
  • That means anything built prior to this date is not eligible nor would it meet GSE guidelines. Accordingly, these homes are not eligible for Enact’s mortgage insurance.
  • Many manufactured home properties built prior to this date were single-wide manufactured homes.
• FALSE – All manufactured homes must have both a HUD certificate label and the HUD data plate.
  • There are new GSE guidelines that now require only one or the other for existing homes, though new construction still requires both.
  • The only time you won’t be able to see them is on a new construction manufactured home that is under construction, but the appraiser would confirm at the end of the 1004C Manufactured Home Appraisal Report form.  See below for more on this guideline update.
• TRUE – Enact will insure a single wide manufactured home and will defer to GSE guidelines.

Now, let’s jump into more specifics.

Key details to know about HUD data plates and certificate labels

Manufactured homes are built entirely in a factory under a federal building code administered by the U.S. Department of Housing and Urban Development (HUD). They are built to the Manufactured Home Construction and Safety Standards commonly known as the HUD Code.

From the factory, sections of the home are transported to the home site and installed. To ensure the correct sections are installed, each section has a metal plate permanently affixed to the outside. This metal plate is about 2”x4” and called the HUD Certificate Label or tag which provides label numbers and serial numbers.

For example, a manufactured home built to be placed on a permanent site/location in Northern Maine is going to be built to different HUD Codes than one built to be in South Florida. The manufacturers need to account for a home withstanding different elements and as such, the HUD building standards will reflect those needs. Conversely, if a manufactured home built for South Florida was erected in Northern Maine, it would not be eligible according to the GSEs or for Enact mortgage insurance. The ineligibility would be due to the difference in HUD Codes established for the final and permanent location. For additional clarification, per Enact’s Underwriting Guidelines, the unit must not have been previously installed or occupied at any other site or location, except from the manufacturer or the dealer’s lot as a new unit.

Sample HUD Certification Exterior Label/Plate

Once the unit is built and complete, a HUD certificate label is attached to the exterior of each manufactured home unit. In the event the unit is a double wide, there would be two total with one on each unit.

Sample Interior HUD Data Plate

The appraiser will look at the HUD data plate, or the HUD compliance certificate, usually found on the inside of a cupboard, cabinet or closet door and located in the interior of the manufactured home. This has a map of the U.S. to let the consumer know the wind zone and snow load for which the home was built. Here is a sample of what it looks like:

Appraiser Responsibilities: The appraiser is responsible for completing the 1004C Manufactured Home Appraisal Report form indicating whether they were able to locate HUD certificate label and/or the HUD data plate. The appraiser would confirm this on page 1 of the Manufactured Home Appraisal Report. They will also take a photo of the HUD certificate label (on the exterior of the MH unit) and the HUD data plate (located in the interior usually attached to an inside cupboard, closet, cabinet door). The appraiser will then review to confirm the date the unit was built as well.

Missing Label or Data Plate: If the HUD certification label or the interior HUD data plate are missing, lenders are no longer required to order IBTS letters (Institute for Building Technology and Safety/ IBTS.org). However, if you’re missing both, you’ll need to an IBTS letter, any one of which is acceptable (i.e., either a verification certificate or label verification letter). IBTS letters are the only approved alternative that FNMA/FHLMC will accept. Enact defers to GSE manufactured housing guidelines and would follow the above as well.

How the GSEs and Enact insure manufactured housing units

The GSEs will accept single wide manufactured homes subject to their guidelines and requirements. And, as we’ve already stated, Enact defers to the GSE guidelines for single wide manufactured homes.

See the following for more information on single wide manufactured housing units, appraisal considerations, and how Enact and the GSEs respond to them:

• Enact will insure a single wide manufactured home and will defer to the GSE guidelines entirely.
• Enact and the GSEs require appraisal comps to be nearby to confirm marketability.
• These housing units must be a minimum of 400 square feet and 12 feet wide.
• Single wide manufactured homes tend to be seen in more rural communities than suburban ones.
• GSEs and Enact prefer similar comparisons, with the GSEs requiring a minimum of “2” similar single wide manufactured home comparisons.
• If the manufactured home is permanently affixed to the foundation, it would not require proof or photos to confirm ‘skirting’ (shielding the permanent affixation). However, it would require that the appraiser confirm the manufactured home is permanently affixed to the foundation. For example, the tongue and wheels must be removed, and the subject unit must be permanently affixed and taxed as real estate.

Remember, with more customers potentially turning to this type of housing unit, you’ll need to stay familiar with any timely GSE guideline updates. If you ever need to reference GSE guidelines and the requirements for manufactured housing units, access Fannie Mae’s Selling Guide and Freddie Mac’s Seller/Servicer Guide.

More Ways We Can Help

Your Enact MI team has got you covered. They can answer any of your important questions about manufactured housing requirements, and more! Our Regional Underwriting Team is available to assist you Monday-Friday 8am to 8pm ET at 800-444-5664 option 2.

Be sure to make the most of your MI experience, too. Please explore our many underwriting resources and underwriting tips for more information. Because going the extra mile comes easy for us, we also offer a comprehensive suite of training resources to help boost your industry experience.

Want even more information on manufactured housing? Join us on September 24^th at 12 PM EST for our upcoming live training session on Manufactured Housing!

Source:  Amy Hopkins is a Regional Underwriter for Enact.

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