USDA SFH Guaranteed Loan Program Technical Handbook HB-1-3555 ¶13.8 — Definition

USDA SFH Guaranteed Loan Program Technical Handbook HB-1-3555 ¶13.8 — Definition

13.8 DEFINITION Manufactured homes are single-or multi-width units constructed partially off-site and transported to a site to be completed and anchored to a permanent foundation. Manufactured homes are structures built to the Federal Manufactured Home Construction and Safety Standards (FMHCSS) and evidenced by an affixed HUD Certification Label. They are not the same as a modular home. The primary distinction between manufactured homes and modular lies in the construction standards or code and the inspection processes they must adhere to. Unless otherwise specified in this section, the guidelines and procedures outlined in Chapters 6 and 12 for new construction should be followed. 13.9 AUTHORIZED LOAN PURPOSES The following are eligible loan purposes for the financing of manufactured homes: HB-1-3555 (03-09-16) SPECIAL PN 13-9 Revised (10-12-23) PN 594 Guidance documents lack the force and effect of law, unless expressly authorized by statute or incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available through their guidance portal, except to establish historical facts. x Site development work that conforms to the standards imposed by the state and local government. x Purchase of an eligible new unit, transportation, and set-up costs. The following criteria outlines an eligible new manufactured unit for guarantee with the Single Family Housing Guaranteed Loan Program (SFHGLP): o Must be a new unit in stock that has never been installed or occupied at any other site or location. Manufactured units may be moved only from the manufacturers or dealer’s lot to the site on which the unit will be financed. o Must have a floor area of not less than 400 square feet. o Must be placed on a permanent foundation built to FHA guidelines in effect at the time of certification. Guidelines are presently published in the “Permanent Foundation Guide for Manufactured Housing” (HUD- 4930.3G). o Meet or exceed the Federal Manufactured Home Construction and Safety Standard (FMHCSS) Uo Value Zone for the geographic area the unit will be placed. The Uo Value Zone will be indicated on the Comfort Heating and Cooling Certificate. Builder must certify thermal requirements at time of purchase have been met. o Must have a manufacture date that is within 12 months of the date of loan closing. The manufactured home must be affixed with a data plate located inside the home in which the date the unit was manufactured can be found. The certification label must be affixed in a location that will remain visible after all work is completed that is necessary to complete the installation of the home at the home site. x As an alternative to the original HUD Certification Label(s), the lender may obtain a verification letter with the same information contained on the HUD Certification Label(s) from the Institute for Building Technology and Safety (IBTS). A duplicate HUD Data Plate may be available from IBTS or by contacting the In-Plant Primary Inspection Agency (IPIA) of the manufacturer. A list of IPIA and DAPIA offices is posted on HUD’s website. o Construction and site requirements for new dwellings can be found in section 13.11. HB-1-3555 (03-09-16) SPECIAL PN 13-10 Revised (10-12-23) PN 594 Guidance documents lack the force and effect of law, unless expressly authorized by statute or incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available through their guidance portal, except to establish historical facts. x Purchase of an eligible existing unit and site. The following criteria outlines an eligible unit manufactured unit for guarantee under the SFHGLP: o Must be an existing unit that has never been previously installed on a different homesite. o Must have a floor area of not less than 400 square feet. o Must have not had any alterations or modifications since construction in the factory, except for porches, decks, or other structures which were built to engineered designs or were approved and inspected by local code officials. o Must be installed on a permanent foundation in accordance with the manufacturer’s requirements and HUD installation standards. Guidelines are presently published in the “Permanent Foundation Guide for Manufactured Housing” (HUD-4930.3G). Certification of a proper foundation is required. o Must meet or exceed the Federal Manufactured Home Construction and Safety Standard (FMHCSS) Uo Value Zone for the geographic area. o Must have a manufacture date that is within 20 years from the date of loan closing and meets or exceeds the Federal Manufactured Home Construction and Safety Standard (FMHCSS) as evidenced by both an affixed HUD Certification label and HUD Data Plate. The manufacture date can be found on the data plate located inside the home. x As an alternative to the original HUD Certification Label(s), the lender may obtain a verification letter with the same information contained on the HUD Certification Label(s) from the Institute for Building Technology and Safety (IBTS). A duplicate HUD Data Plate may be available from IBTS or by contacting the In-Plant Primary Inspection Agency (IPIA) of the manufacturer. A list of IPIA and DAPIA offices is posted on HUD’s website. x Financing of an existing unit due to a transfer of an existing Section 502 Direct or Guarantee loan or purchase of a Real Estate Owned (REO) property. Repairs associated with these transactions may be included. 13.10 LOAN RESTRICTIONS The Agency will not guarantee loans to finance the following: HB-1-3555 (03-09-16) SPECIAL PN 13-11 Revised (10-12-23) PN 594 Guidance documents lack the force and effect of law, unless expressly authorized by statute or incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available through their guidance portal, except to establish historical facts. x The purchase of a unit without an eligible site. x The purchase of an existing unit that was not constructed in conformance with the Federal Manufactured Home Construction and Safety Standards (FMHCSS) as evidenced by an affixed HUD Certification label and HUD Data Plate x The existing unit was not installed on a permanent foundation complying with manufacturer and HUD installation standards. x Furniture, including movable articles of personal property such as drapes, beds, bedding, chairs, sofas, divans, lamps, tables, televisions, radios, stereo sets, and other similar items of personal property. Furniture does not include wall-to-wall carpeting, refrigerators, ovens, ranges, washing machines, clothes dryers, heating or cooling equipment, or other similar equipment. x Additions and modifications on new or existing units are prohibited except for porches, decks, or other structures built to engineered designs and inspected and approved by a local building code official. x Purchase of a unit to be moved from a site other than the manufacturer/dealer lot to the site securing the mortgage loan. x Existing manufactured home units with a manufacture date exceeding 20 years from the date of loan closing unless the unit and site are already financed with a Section 502 loan. x A unit with a tow hitch or running gear remaining. 13.11 CONSTRUCTION AND SITE REQUIREMENTS FOR NEW DWELLINGS The borrower will contract with a licensed manufactured dealer. Manufactured homes must meet the site and other requirements for new dwellings in accordance with Chapter 12 of this Handbook. The lender’s permanent loan file must contain the following: x An itemized cost breakdown of the total package, including the base unit, eligible options, site development, installation, set-up, lot costs, and any credit for wheels and axles. x Dealer certification that any cash payment or rebate as a result of the purchase will be deducted from the price of the unit and not paid directly to the applicants. HB-1-3555 (03-09-16) SPECIAL PN 13-12 Revised (10-12-23) PN 594 Guidance documents lack the force and effect of law, unless expressly authorized by statute or incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available through their guidance portal, except to establish historical facts. x Dealer certification that proposed cost is the full price of the unit. If furniture is being purchased by the applicants with personal funds, a lien will not be filed against the security property. x Foundation plan designed to meet the HUD Handbook 4930.3G, Permanent Foundations Guide for Manufactured Housing (PFGMH), guidelines. x Plot and site development plans. x Inspections in accordance with Chapter 12 of this Handbook. x Contractor certification that multi-sectioned units were properly joined and sealed according to the manufacturer's specifications and the home sustained no damage during transportation and set-up. 13.12 LOAN CLOSING FOR MANUFACTURED HOUSING Loan closing procedures are the same whether the guarantee is made for the purchase of a manufactured home or another type of single-family home. However, the lender should be aware of the following requirements. A. Warranty Requirement A dealer must provide the borrower with a copy of all manufacturer warranties. The warranty must identify the unit by serial number. A copy of all warranties and certifications will be retained in the lender’s permanent loan file. B. Lien Release Requirements The dealer must furnish a manufacturer's certificate of origin indicating that the unit is free and clear of all legal encumbrances. A copy of the manufacturer’s statement or certificate of origin will be retained in the lender’s permanent loan file. C. Real Estate Tax Requirement As required by the local taxing authority, the unit and site must be classified, zoned, and taxed as real estate. Certificate of title to the manufactured home must be surrendered to the appropriate state government authority if state law permits. D. Title and Lien Requirements The mortgage must be insured by a standard real property title insurance policy. Refer to title insurance policy requirements outlined in Chapter 16 of this Handbook. HB-1-3555 (03-09-16) SPECIAL PN 13-13 Revised (10-12-23) PN 594 Guidance documents lack the force and effect of law, unless expressly authorized by statute or incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available through their guidance portal, except to establish historical facts. Additionally, both the unit and the site must be evidenced by a recorded mortgage or deed of trust. A combination of a chattel and real estate mortgage is not acceptable. If the certificate of title cannot be surrendered, the lender must indicate its lien on the certificate of title. SECTION 3: MODULAR HOMES Modular homes are sectional prefabricated houses that consist of multiple modules or sections which are typically manufactured in a remote facility and delivered to their site of intended use. They differ from manufactured homes largely in their absence of axles or frame. Modular dwellings are commonly transported to their site by means of flat-bed trucks and set in place with the assistance of a crane. Modular homes, whether “off frame” or “on frame”, are considered stick-built homes; therefore, the guidance outlined in Chapter 12 of this Handbook will be followed for new and existing modular homes. HB-1-3555 (03-09-16) SPECIAL PN 14-1 Revised (10-12-23) PN 594 Guidance documents lack the force and effect of law, unless expressly authorized by statute or incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available through their guidance portal, except to establish historical facts. CHAPTER 14: FUNDING [Official Agency Use Only]

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