Manufactured Housing News

In a new survey conducted by the CRE Finance Council, industry experts predicted a significant increase in the home loan origination volumes in 2016. Finding new ways to capitalize on the investment opportunities provided by the underserved manufactured housing finance market is very important for a credit union seeking to offer its members more flexible and affordable home loan solutions.

As a continuation of a previous article, in this post we're going to present three more ways a credit union can use manufactured home loans to enhance its loan portfolio.

Expand financing in underserved housing markets.

Adding manufactured home loans to your loan portfolio allows your credit union to effectively address the needs of the people affected by the extreme shortage of decent and affordable housing. Considering that the manufactured housing loan market is currently being underserved, now is the right time to opt for these loan products in order to get a bigger slice of the manufactured home lending “pie."

But that's not all. As more lenders will be afforded the opportunity to enter the secondary market for manufactured home loans, the capital costs will decrease, as attested by the MHI. This will bring an influx of investors, capital and additional financing options to the manufactured housing finance market, enabling more consumers to finance their manufactured home purchases. Increasing numbers of home buyers will generate an exponential revenue and profit growth for many lenders operating across this industry sector.

Focus on pre-owned home financing.

For a credit union, manufactured home loans for pre-owned homes can become a driving force behind its loan portfolio. Stagnant wages, persistent rental housing shortage and rental rates predicted to increase significantly by the end of the year have persuaded more renters to look for affordable homeownership opportunities. As a result, the demand for affordable housing is currently growing at a faster pace than previously anticipated.

Although a new manufactured home could cost as little as $45,000, certain consumer groups prefer pre-owned homes to new construction. In addition to price, some other factors people take into account when buying a home include the location, neighborhood reputation and future developments in the area.

Unfortunately, most lenders don’t provide small home loans, specifically because loans under $50,000 are just not worth it to them. But “financing (…) used manufactured homes is [even] more difficult”, according to a report from the NC Housing Coalition. Since fewer financing options are available for pre-owned manufactured homes compared to new homes, pre-owned manufactured home lending offers an unexpected loan portfolio opportunity for growing market share.

Get closer to your community.

In addition to providing quality and reliable services, a credit union can increase its visibility by getting involved in the community it serves. While volunteering and charitable initiatives can help your credit union attract new members, one way to cultivate strong relationships with them is to meet their financial needs. This can be done by improving their access to affordable financing alternatives.

By adding manufactured home loans to your loan portfolio, you can serve many consumers in search of affordable housing. Therefore, including manufactured home loans in your portfolio isn't only a good financial decision but also a socially responsible one that will set your credit union apart from all the others.

As a leading manufactured home lender, Triad Financial Services, Inc. fully understands the need for convenient and affordable financing for both new and pre-owned manufactured homes. To offer as many people as possible the opportunity to make their homeownership dreams come true, we’re ready to help credit unions and other categories of investors diversify their loan portfolios with relevant, high-yield and low-risk manufactured home loan products. To learn more about our financial products and services, contact our dedicated professionals serving all major areas of the manufactured home lending industry.