MH ADVANTAGE HOMES

Fannie Mae invests in manufactured housing loans to serve its mission of expanding affordable housing by providing liquidity to a market segment that is crucial to many Americans. Manufactured housing offers a low-cost alternative to site-built homes for millions of American households, especially in high-cost and rural areas. A “manufactured home” for the purposes of Fannie Mae’s program is a dwelling that is built on a permanent chassis and installed on a permanent foundation system. MH Advantage™ is a manufactured housing loan product that offers flexible underwriting standards and reduced pricing for manufactured homes that are built to meet specific construction, architectural design, and energy efficiency standards. Properties that are eligible for MH Advantage™ financing are designated as such by the manufacturer. MH Advantage™ offers higher loan-to-value ratios (up to 97 percent), and reduced pricing in the form of waived standard manufactured housing loan level price adjustments (0.50 percent) and reduced mortgage insurance coverage requirements for fixed-rate terms.

Manufactured housing is the country’s largest source of unsubsidized affordable housing. Lenders’ ability to sell loans secured by manufactured housing to Fannie Mae is an important contributor to extending access to credit to low-income households. Fannie Mae purchases mortgages secured by manufactured housing titled as real estate through approved lender partners.

How is MH Advantage different from Fannie Mae’s standard MH loan?

MH Advantage may only be used to finance manufactured homes that have the MH Advantage sticker. Loans secured by MH Advantage properties feature a number of flexibilities compared with standard MH, including:

• Higher loan-to-value (LTV) ratios, up to 97%
• Waived standard MH 0.50% loan-level price adjustment (LLPA)
• Reduced MI coverage required for fixed-rate terms ≤ 20 years

BORROWER CRITERIA

Income limits: This program has no income limits.

Credit: Fannie Mae’s standard credit requirements apply (minimum credit score of 620). Fannie Mae uses trended data in its credit risk assessment including those loans submitted through Desktop Underwriter®. Trended credit data provides expanded information on a borrower’s revolving account credit history including whether the borrower pays off the balance each month or makes the minimum payment due, and whether the borrower exceeds the credit limit.

First-time homebuyers: First-time homebuyer status confers no benefit.

Occupancy and ownership of other properties: The home must be owner occupied or a second home, not an investment property.

Special populations: There are no incentives for special populations.

Special assistance for persons with disabilities: There is no special assistance for people with disabilities.

Manufactured home criteria: Manufactured housing designated as MH Advantage™ eligible must meet Fannie Mae’s definition of a “manufactured home” (defined below) and also offer certain construction, architectural design, and energy efficiency standards that are more consistent with site-built homes. Manufactured homes that are eligible for an MH Advantage™ loan must have an MH Advantage™ sticker affixed to the property by the manufacturer. The property appraisal must include photos of the MH Advantage™ Sticker, HUD Data Plate, HUD Certifications Labels, and the site showing all driveways, sidewalks, and detached structures located on the site. Examples of MH Advantage physical characteristics include but are not limited to distinctive roof treatments, lower profile foundations, and construction durability features such as durable siding. Fannie Mae follows HUD’s definition of manufactured homes. The manufactured home must be at least 12 feet wide and have a minimum of 600 square feet of gross living area. The dwelling must assume the characteristics of site-built housing, including being attached to a permanent foundation and connected to utilities. Single-wide manufactured homes, unless located in a Fannie Mae-approved subdivision, co-op, condominium, or planned unit development are not allowed. Homes located on leased land are not allowed. The mortgage loan must be secured by both the manufactured home and the land on which it is situated, and both the manufactured home and the land must be legally classified as real property and secured by a single lien, under applicable state law. Fannie Mae treats modular, prefabricated, panelized, or sectional housing homes the same as site-built housing, not as manufactured housing