H.R. 2139House110th Congress (2007-2009)Passed House

FHA Manufactured Housing Loan Modernization Act of 2007

Legislative Activity

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12 earlier actions

SenateIntro Referral Latest Action

Received in the Senate and Read twice and referred to the Committee on Banking, Housing, and Urban Affairs.

Banking, Housing, and Urban Affairs Committee

June 26, 2007

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HouseIntro Referral

Introduced in House

May 3, 2007

HouseIntro Referral

Referred to the House Committee on Financial Services.

Financial Services Committee

May 3, 2007

HouseCommittee

Committee Consideration and Mark-up Session Held.

Financial Services Committee

May 23, 2007

HouseCommittee

Ordered to be Reported (Amended) by Voice Vote.

Financial Services Committee

May 23, 2007

HouseCommittee

Reported (Amended) by the Committee on Financial Services. H. Rept. 110-206.

Financial Services Committee

June 21, 2007

HouseCalendars

Placed on the Union Calendar, Calendar No. 125.

June 21, 2007

HouseFloor

Mr. Donnelly moved to suspend the rules and pass the bill, as amended.

June 25, 2007 • 3:21 PM

HouseFloor

Considered under suspension of the rules. (consideration: CR H7025-7027)

June 25, 2007 • 3:21 PM

HouseFloor

DEBATE - The House proceeded with forty minutes of debate on H.R. 2139.

June 25, 2007 • 3:21 PM

HouseFloor

Passed/agreed to in House: On motion to suspend the rules and pass the bill, as amended Agreed to by voice vote.(text: CR H7025-7026)

June 25, 2007 • 3:31 PM

HouseFloor

On motion to suspend the rules and pass the bill, as amended Agreed to by voice vote. (text: CR H7025-7026)

June 25, 2007 • 3:31 PM

HouseFloor

Motion to reconsider laid on the table Agreed to without objection.

June 25, 2007 • 3:31 PM

SenateIntro Referral

Received in the Senate and Read twice and referred to the Committee on Banking, Housing, and Urban Affairs.

Banking, Housing, and Urban Affairs Committee

June 26, 2007

Floor Debate

3 members

What members said about H.R. 2139 on the floor

1 Republican2 Democrats

Rep. Ginny Brown-WaiteR-FL-5 · Jun 25, 2007

Mr. Speaker, I yield myself such time as I may consume. Mr. Speaker, I rise in support of H.R. 2139, the Manufactured Housing Loan Improvement Act of 2007. It is virtually identical to legislation…

Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, I rise in support of H.R. 2139, the Manufactured Housing Loan Improvement Act of 2007. It is virtually identical to legislation that passed the House last year, only it was called the act of 2006, and it passed by 412-6. Obviously, it was a very popular bill.

The bill that we are considering today would modernize the FHA title I manufactured housing loan program, which insures loans for manufactured homes owned on leased land, for lots used to site manufactured homes, and for a combination of manufactured homes and lots. The program is different from the insuring of manufactured homes under title II of FHA, in which the manufactured home is sited

on land also owned and mortgaged under the loan.

As the gentleman from Indiana stated, in 1992 some 3,000 loans were insured under the FHA title I manufactured housing loan program. However, last year this number dropped to around 1,500 loans. Clearly this legislation seeks to address the factors that have been widely cited as the reasons for the steep decline in the number of insured loans. These include vague underwriting standards; a portfolio cap on title I loans; a guarantee that is not sufficient for acceptance in the secondary market; loan limits that have not kept up with inflation, and, actually, they haven't been adjusted since 1992; and a resulting reduced private sector loan origination participation.

During the Financial Services Committee markup of this legislation, Congressman Bachus offered and the committee accepted wording that would authorize the GAO to assess how the Secretary of Housing and Urban Development utilizes the FHA manufactured housing loan insurance program and other programs administered by HUD to mitigate the risk to manufactured housing residents and communities resulting from tornadoes.

Every year, an average of 800 tornadoes sweep across the United States, resulting in more than 80 deaths, more than 1,500 injuries and millions of dollars in property damage. One of nature's most powerful and violent storms, large tornadoes often record winds with speeds in excess of 250 miles an hour.

Florida and parts of my district were ravaged by these tornadoes earlier this year, which reminded us that natural catastrophes can strike with little warning, forcing communities to confront a loss of infrastructure and, unfortunately, sometimes a loss of life.

Many residents of homes have a place to go in the event of a tornado, whether it is a basement or an interior room. Manufactured housing residents do not have a basement and they often do not have an interior room. Despite rapid advances in tornado warning technology, residents of manufactured housing communities often do not have adequate access to proper shelter.

That is why the House passed the Tornado Shelters Act, which was signed into law in 2003. That bipartisan bill authorized communities to use community development block grant money to construct or improve tornado-safe shelters located in manufactured housing park areas.

Unfortunately, it is not used enough. Often in the face of a tornado threat, it is said we can do two things: pray and prepare. Pray it won't happen again and prepare for the next line of twisters.

While the residents can pray, our government and this Congress can do much to help them prepare.

As we improve the title I manufactured housing loan programs, I hope we can do everything in our power to ensure that residents of manufactured housing communities have adequate protection from natural catastrophes such as tornadoes. H.R. 2139 will facilitate greater access to manufactured housing, and I urge my colleagues to support it.

Mr. Speaker, I have no further requests for time, and I yield back the balance of my time.

Rep. Joe DonnellyD-IN-2 · Jun 25, 2007

Mr. Speaker, I move to suspend the rules and pass the bill (H.R. 2139) to modernize the manufactured housing loan insurance program under title I of the National Housing Act, as amended. Mr. Speaker,…

Mr. Speaker, I move to suspend the rules and pass the bill (H.R. 2139) to modernize the manufactured housing loan insurance program under title I of the National Housing Act, as amended.

Mr. Speaker, I ask unanimous consent that all Members may have 5 legislative days within which to revise and extend their remarks on this legislation and to insert extraneous material thereon.

Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, the FHA Manufactured Housing Loan Modernization Act of 2007, which I introduced with my colleagues Chairman Frank, Mr. Tiberi and Mr. Feeney, includes important provisions that will help revitalize the manufactured housing industry, which plays a critical role in helping Americans achieve the dream of home ownership by providing them with alternative opportunities for affordable housing. This bill passed the Financial Services Committee unanimously on May 28, 2007.

This $8 billion a year industry provides jobs for people not only in the Second District of Indiana, but throughout the country. These homes house 22 million people in over 10.5 million homes.

Mr. Speaker, I have seen firsthand in my own district how these homes have continued a tradition of quality and safe construction over many years. They present a high quality, affordable housing opportunity for American families.

H.R. 2139 would raise the manufactured housing title I loan limits and annually index them for inflation. It will also give HUD the authority to increase insurance premiums and improve underwriting standards in order to make sure that the program is actuarially sound.

We have a proud and strong tradition in Elkhart and in other Indiana communities of providing first class housing for Americans, providing quality jobs for Hoosiers at the same time. It is part of who we are. In turn, these communities are extraordinarily proud of the role they play and that we play in our district in providing housing for American homebuyers.

Unfortunately, title I loan limits have not been adjusted for inflation since 1992 and the manufactured housing industry has experienced a major decline since that time. In 1992, in the midst of the last downturn, FHA insured 30,000 title I loans. In 2006, that number was less than 1,500. In Indiana alone, that number went from 377 loans in 1992 to only four last year.

These are more than just numbers. They represent a serious drop in a crucial component of affordable home ownership for Americans. This not only affects low and moderate income families that these loans are designed to help, but it affects the manufactured housing industry and the housing market as a whole.

Because of the drastic reduction in FHA title I loans, American families are left to struggle to try and find adequate financing options for their manufactured home purchases. This body has a responsibility to try and provide affordable housing options for American families, and this legislation does just that.

As you know, Mr. Speaker, June is Home Ownership Month, and it is only fitting that we pass this much-needed legislation. Today, I urge all my colleagues to support H.R. 2139, to strengthen the American housing market and to put more affordable housing opportunities within reach for American families.

Mr. Speaker, I reserve the balance of my time.

Mr. Speaker, I want to thank my colleague, the gentlewoman from Florida (Ms. Ginny Brown-Waite). This is an excellent piece of legislation. My colleagues on both sides of the aisle are in support and are participating in H.R. 2139.

Mr. Speaker, I yield back the balance of my time.

Rep. Brad EllsworthD-IN-8 · Jun 25, 2007

Mr. Speaker, I rise today to urge my colleagues to support the millions of Americans who live in manufactured housing across the country. Over the years, the willingness of Americans to work hard and…

Bill Text

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Referred in SenateIssued June 26, 2007

IIB

110th CONGRESS

1st Session

H. R. 2139

IN THE SENATE OF THE UNITED STATES

June 26, 2007

Received; read twice and referred to the Committee on Banking, Housing, and Urban Affairs

AN ACT

To modernize the manufactured housing loan insurance program under title I of the National Housing Act.

Short title

This title may be cited as the FHA Manufactured Housing Loan Modernization Act of 2007.

Findings and purposes

(a)

Findings

The Congress finds that—

(1)

manufactured housing plays a vital role in providing housing for low- and moderate-income families in the United States;

(2)

the FHA title I insurance program for manufactured home loans traditionally has been a major provider of mortgage insurance for home-only transactions;

(3)

the manufactured housing market is in the midst of a prolonged downturn which has resulted in a severe contraction of traditional sources of private lending for manufactured home purchases;

(4)

during past downturns the FHA title I insurance program for manufactured homes has filled the lending void by providing stability until the private markets could recover;

(5)

in 1992, during the manufactured housing industry’s last major recession, over 30,000 manufactured home loans were insured under title I;

(6)

in 2006, fewer than 1,500 manufactured housing loans were insured under title I;

(7)

the loan limits for title I manufactured housing loans have not been adjusted for inflation since 1992; and

(8)

these problems with the title I program have resulted in an atrophied market for manufactured housing loans, leaving American families who have the most difficulty achieving homeownership without adequate financing options for home-only manufactured home purchases.

(b)

Purposes

The purposes of this Act are—

(1)

to provide adequate funding for FHA-insured manufactured housing loans for low- and moderate-income homebuyers during all economic cycles in the manufactured housing industry;

(2)

to modernize the FHA title I insurance program for manufactured housing loans to enhance participation by Ginnie Mae and the private lending markets; and

(3)

to adjust the low loan limits for title I manufactured home loan insurance to reflect the increase in costs since such limits were last increased in 1992 and to index the limits to inflation.

Exception to limitation on financial institution portfolio

The second sentence of section 2(a) of the National Housing Act (12 U.S.C. 1703(a)) is amended—

(1)

by striking In no case and inserting Other than in connection with a manufactured home or a lot on which to place such a home (or both), in no case; and

(2)

by striking : Provided, That with and inserting . With.

Insurance benefits

(a)

In General

Subsection (b) of section 2 of the National Housing Act (12 U.S.C. 1703(b)), is amended by adding at the end the following new paragraph:

(8)

Insurance benefits for manufactured housing loans

Any contract of insurance with respect to loans, advances of credit, or purchases in connection with a manufactured home or a lot on which to place a manufactured home (or both) for a financial institution that is executed under this title after the date of the enactment of the FHA Manufactured Housing Loan Modernization Act of 2007 by the Secretary shall be conclusive evidence of the eligibility of such financial institution for insurance, and the validity of any contract of insurance so executed shall be incontestable in the hands of the bearer from the date of the execution of such contract, except for fraud or misrepresentation on the part of such institution.

(b)

Applicability

The amendment made by subsection (a) shall only apply to loans that are registered or endorsed for insurance after the date of the enactment of this Act.

Maximum loan limits

(a)

Dollar Amounts

Paragraph (1) of section 2(b) of the National Housing Act (12 U.S.C. 1703(b)(1)) is amended—

(1)

in clause (ii) of subparagraph (A), by striking $17,500 and inserting $25,090;

(2)

in subparagraph (C) by striking $48,600 and inserting $69,678;

(3)

in subparagraph (D) by striking $64,800 and inserting $92,904;

(4)

in subparagraph (E) by striking $16,200 and inserting $23,226; and

(5)

by realigning subparagraphs (C), (D), and (E) 2 ems to the left so that the left margins of such subparagraphs are aligned with the margins of subparagraphs (A) and (B).

(b)

Annual Indexing

Subsection (b) of section 2 of the National Housing Act (12 U.S.C. 1703(b)), as amended by the preceding provisions of this Act, is further amended by adding at the end the following new paragraph:

(9)

Annual indexing of manufactured housing loans

The Secretary shall develop a method of indexing in order to annually adjust the loan limits established in subparagraphs (A)(ii), (C), (D), and (E) of this subsection. Such index shall be based on the manufactured housing price data collected by the United States Census Bureau. The Secretary shall establish such index no later than one year after the date of the enactment of the FHA Manufactured Housing Loan Modernization Act of 2007.

(c)

Technical and Conforming Changes

Paragraph (1) of section 2(b) of the National Housing Act (12 U.S.C. 1703(b)(1)) is amended—

(1)

by striking No and inserting Except as provided in the last sentence of this paragraph, no; and

(2)

by adding after and below subparagraph (G) the following:

The Secretary shall, by regulation, annually increase the dollar amount limitations in subparagraphs (A)(ii), (C), (D), and (E) (as such limitations may have been previously adjusted under this sentence) in accordance with the index established pursuant to paragraph (9).

Insurance premiums

Subsection (f) of section 2 of the National Housing Act (12 U.S.C. 1703(f)) is amended—

(1)

by inserting (1) Premium charges.— after (f); and

(2)

by adding at the end the following new paragraph:

(2)

Manufactured home loans

Notwithstanding paragraph (1), in the case of a loan, advance of credit, or purchase in connection with a manufactured home or a lot on which to place such a home (or both), the premium charge for the insurance granted under this section shall be paid by the borrower under the loan or advance of credit, as follows:

(A)

At the time of the making of the loan, advance of credit, or purchase, a single premium payment in an amount not to exceed 2.25 percent of the amount of the original insured principal obligation.

(B)

In addition to the premium under subparagraph (A), annual premium payments during the term of the loan, advance, or obligation purchased in an amount not exceeding 1.0 percent of the remaining insured principal balance (excluding the portion of the remaining balance attributable to the premium collected under subparagraph (A) and without taking into account delinquent payments or prepayments).

(C)

Premium charges under this paragraph shall be established in amounts that are sufficient, but do not exceed the minimum amounts necessary, to maintain a negative credit subsidy for the program under this section for insurance of loans, advances of credit, or purchases in connection with a manufactured home or a lot on which to place such a home (or both), as determined based upon risk to the Federal Government under existing underwriting requirements.

(D)

The Secretary may increase the limitations on premium payments to percentages above those set forth in subparagraphs (A) and (B), but only if necessary, and not in excess of the minimum increase necessary, to maintain a negative credit subsidy as described in subparagraph (C).

Technical corrections

(a)

Dates

Subsection (a) of section 2 of the National Housing Act (12 U.S.C. 1703(a)) is amended—

(1)

by striking on and after July 1, 1939, each place such term appears; and

(2)

by striking made after the effective date of the Housing Act of 1954.

(b)

Authority of Secretary

Subsection (c) of section 2 of the National Housing Act (12 U.S.C. 1703(c)) is amended to read as follows:

(c)

Handling and Disposal of Property

(1)

Authority of secretary

Notwithstanding any other provision of law, the Secretary may—

(A)

deal with, complete, rent, renovate, modernize, insure, or assign or sell at public or private sale, or otherwise dispose of, for cash or credit in the Secretary’s discretion, and upon such terms and conditions and for such consideration as the Secretary shall determine to be reasonable, any real or personal property conveyed to or otherwise acquired by the Secretary, in connection with the payment of insurance heretofore or hereafter granted under this title, including any evidence of debt, contract, claim, personal property, or security assigned to or held by him in connection with the payment of insurance heretofore or hereafter granted under this section; and

(B)

pursue to final collection, by way of compromise or otherwise, all claims assigned to or held by the Secretary and all legal or equitable rights accruing to the Secretary in connection with the payment of such insurance, including unpaid insurance premiums owed in connection with insurance made available by this title.

(2)

Advertisements for proposals

Section 3709 of the Revised Statutes shall not be construed to apply to any contract of hazard insurance or to any purchase or contract for services or supplies on account of such property if the amount thereof does not exceed $25,000.

(3)

Delegation of authority

The power to convey and to execute in the name of the Secretary, deeds of conveyance, deeds of release, assignments and satisfactions of mortgages, and any other written instrument relating to real or personal property or any interest therein heretofore or hereafter acquired by the Secretary pursuant to the provisions of this title may be exercised by an officer appointed by the Secretary without the execution of any express delegation of power or power of attorney. Nothing in this subsection shall be construed to prevent the Secretary from delegating such power by order or by power of attorney, in the Secretary’s discretion, to any officer or agent the Secretary may appoint.

Revision of underwriting criteria

(a)

In General

Subsection (b) of section 2 of the National Housing Act (12 U.S.C. 1703(b)), as amended by the preceding provisions of this Act, is further amended by adding at the end the following new paragraph:

(10)

Financial soundness of manufactured housing program

The Secretary shall establish such underwriting criteria for loans and advances of credit in connection with a manufactured home or a lot on which to place a manufactured home (or both), including such loans and advances represented by obligations purchased by financial institutions, as may be necessary to ensure that the program under this title for insurance for financial institutions against losses from such loans, advances of credit, and purchases is financially sound.

(b)

Timing

Not later than the expiration of the 6-month period beginning on the date of the enactment of this Act, the Secretary of Housing and Urban Development shall revise the existing underwriting criteria for the program referred to in paragraph (10) of section 2(b) of the National Housing Act (as added by subsection (a) of this section) in accordance with the requirements of such paragraph.

Requirement of social security account number for assistance

Section 2 of the National Housing Act (12 U.S.C. 1703) is amended by adding at the end the following new subsection:

(j)

Requirement of social security account number for financing

No insurance shall be granted under this section with respect to any obligation representing any loan, advance of credit, or purchase by a financial institution unless the borrower to which the loan or advance of credit was made, and each member of the family of the borrower who is 18 years of age or older or is the spouse of the borrower, has a valid social security number.

10.

GAO study of mitigation of tornado risks to manufactured homes

The Comptroller General of the United States shall assess how the Secretary of Housing and Urban Development utilizes the FHA manufactured housing loan insurance program under title I of the National Housing Act, the community development block grant program under title I of the Housing and Community Development Act of 1974, and other programs and resources available to the Secretary to mitigate the risks to manufactured housing residents and communities resulting from tornados. The Comptroller General shall submit to the Congress a report on the conclusions and recommendations of the assessment conducted pursuant to this section not later than the expiration of the 12-month period beginning on the date of the enactment of this Act.

Passed the House of Representatives June 25, 2007.

Lorraine C. Miller,

Clerk.