By Mike Dixon, Fannie Mae
Manufactured homes (MH) have long served as a source of affordable housing for millions of Americans. But now, as rising prices and limited supply of single-family homes continue to weigh on markets across the country, today’s modern manufactured housing plays a more critical role in bridging the nation’s affordable supply gap.
Fannie Mae launched MH Advantage® in 2018 to offer an affordable housing solution to homebuyers who were priced out of owning a home in their communities. We worked with some of the industry’s leading home producers to develop a new class of manufactured home and pair it with financing options that would put homeownership within reach for those homebuyers.
With external features like higher pitched roof lines, covered porches, dormers, and garages or car ports, these homes have the curb appeal that consumers expect from a site-built home. The interiors of these impress as well, with features like enhanced cabinetry in kitchens and bathrooms and customizable finishes. Energy efficiency requirements ensure lasting affordability as well.
While the lower price point of manufactured homes helps keep MH Advantage-qualifying properties attainable, MH Advantage financing provides homebuyers with many of the same benefits that site-built homebuyers might expect. Traditionally, manufactured home purchasers typically pay more in interest on their loans than traditional homeowners as manufactured homes are usually financed through chattel loans, which tend to have high interest rates. However, MH Advantage features terms such as down payments as low as 3%, conventional financing with cancellable mortgage insurance that’s comparable to site-built homes, and the stability of traditional mortgage loan options, like a 30-year fixed-rate mortgage, which offers predictable payments over the life of the loan.
MH Advantage-eligible homes are available today in markets across the country, supplying a source of affordable housing for U.S. consumers. Leveraging this home type in planned unit developments (PUDs), master-planned communities and subdivisions, or condo and co-op projects provides developers and municipalities the opportunity to meet the growing demand for affordable housing with a high-quality home option paired with amenities that some might not otherwise be able to afford. As with other real property homeownership options, there is also the chance for the home to appreciate in value and help buyers build equity.
For more information about MH Advantage financing and construction requirements, visit Fanniemae.com/manufacturedhomes.
Fannie Mae is Here to Help
Providing access to affordable, sustainable homeownership is a core part of Fannie Mae’s mission, and the COVID-19 global health outbreak has posed challenges for those who are feeling the financial impacts of the pandemic. Renters and borrowers who have been negatively affected can visit KnowYourOptions.com to find resources and guidance that may help them stay in their homes.