FHA Expands Loan Limits for Manufactured Homes

The Federal Housing Administration (FHA) has announced new loan limits for its Title I Manufactured Home Loan Program. The increased amounts use new methodologies for calculating and updating the program’s limits, which were announced in a final rule published on February 29, 2024.

Today’s increase in loan limits marks the first update to the Title I program loan limits since 2008, and supports the Biden Administration’s efforts to increase the supply and use of manufactured homes as a source of affordable housing.

Keeping pace with today’s marketplace

The increases issued by the FHA align with current market prices, and are expected to encourage more lenders to offer the program to homebuyers seeking to purchase manufactured homes and the lots on which they sit.

“We are using every tool possible to make affordable housing available for all Americans,” said HUD Secretary Marcia L. Fudge. “Today’s announcement is another positive step toward helping people to buy manufactured homes, an innovative solution to the affordable housing supply crisis.”

New limits soon to be effective

Effective for FHA case numbers assigned on or after March 29, 2024, the new nationwide Title I Manufactured Home Loan Program loan limits are as follows:

  • Combination Loan (Single-section): $148,909
  • Combination Loan (Multi-section): $237,096
  • Manufactured Home Loan (Single-section): $105,532
  • Manufactured Home Loan (Multi-section): $193,719
  • Manufactured Home Lot Loan: $43,377

FHA will recalculate the program’s loan limits on an annual basis so that they keep pace with home price changes over time.

“Updating the Title I loan limits was the next critical piece in our ongoing efforts to make the Title I Manufactured Home Loan Program work for lenders and homebuyers for whom manufactured housing offers an affordable way to meet their housing needs,” said Federal Housing Commissioner Julia R. Gordon. “We hope these changes will prompt more lenders to consider using the Title I program to meet the financing needs of consumers purchasing or refinancing manufactured homes.”

Manufactured homes to boost inventory

In late February, the Biden Administration released details on how it plans to build more housing and lower housing costs nationwide through a series of initiatives, including:

  • Bolstering federal programs with a track-record of producing affordable housing;
  • The promotion of a more fair and transparent rental market; and
  • Boosting the supply and affordability of manufactured homes.

More than 20 million Americans currently live in manufactured housing, which represents the largest form of unsubsidized affordable housing in the country.

In addition to the FHA’s actions to today’s actions to increase the loan limits for Title I Manufactured Housing, the Biden Administration is taking steps to preserve manufactured home communities and simplify the purchase of manufactured homes, by:

  • Releasing a $225 million funding opportunity to support manufactured housing communities: HUD has announced that the application for Preservation and Reinvestment Initiative for Community Enhancement (PRICE) grants is now open to support the preservation and revitalization of manufactured housing communities. These grants can be used for the replacement of dilapidated homes, assistance for repairs and accessibility modifications, mitigation and resilience upgrades, improvement of infrastructure, housing services including eviction prevention, and planning activities. This marks the first time the federal government has made grant funding available specifically for investments in manufactured housing communities, including resident-owned communities. A portion of funds are dedicated to supporting Tribes and tribal nonprofit organizations.
  • Preserving the affordability of manufactured housing communities via expanded financing options: Corporate investors are purchasing manufactured housing communities and driving up rent and driving out longtime residents. The FHA is publishing a draft Mortgagee Letter that, once finalized, will create a new program to preserve affordability for existing residents of manufactured housing communities. Under the new program, resident cooperatives and other mission-oriented borrowers will be permitted to use FHA 223(f) multifamily loans to acquire or refinance communities.

“Manufactured homes are an important part of the nation’s lower-cost housing stock, yet many families, especially historically underserved communities, lack access to safe and affordable financing for these homes,” said Rachel Seigel, Senior Officer with The Pew Charitable Trusts’ Housing Policy Initiative. “Today’s announcement is a major step towards improving access to financing for thousands of American families that are shut out of today’s housing market.”

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Eric C. Peck

Eric C. Peck has 25-plus years’ experience covering the mortgage industry, most recently serving as Editor-in-Chief for National Mortgage Professional Magazine. He graduated from the New York Institute of Technology, where he received his B.A. in Communication Arts/Media. After graduating, he began his professional career with Videography Magazine before landing in the mortgage space. Peck has edited three published books, and has served as Copy Editor for Entrepreneur.com.
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