H.R 650 – Preserving Access to Manufactured Housing Act

Members of the House Financial Services Committee have reintroduced legislation to help our industry!  H.R 650, the Preserving Access to Manufactured Housing Act of 2015 was introduced on February 2nd by Representatives Stephen Fincher (R-TN), Terri Sewell (D-AL), Andy Barr (R-KY) and Kyrsten Sinema (D-AZ).

Last year, H.R 1779 was introduced and co sponsored by 114 bipartisan representatives.  The Financial Services Committee passed the bill by a unanimous voice vote.  Despite all of our efforts, the bill did not make it all the way through the process prior to adjournment. When it was reintroduced last week it was given a new number, and the co sponsorship list starts again at zero.  MHI has started an advocacy page to make it easy for all of us to contact our representatives and request their support.  Click here to send an email to your representative!

H.R. 1779 Update

HR1779 Preserving Access to Manufactured Housing Act was introduced in the House of Representatives by Representatives Stephen Fincher(R-TN), Bernie Thompson (D-MS) and Gary Miller (R-CA) to reduce regulatory burdens that impede access to affordable manufactured housing finance.  The bill would remedy provisions of the Dodd Frank Wall Street Reform and Consumer Protection Act (Dodd Frank) that impact the consumer’s ability to obtain the mortgage financing needed to purchase a manufactured home.

Bi-partisan Cosponsors are needed!!!

As of 7/26/13, there are 42 cosponsors, 9 Democrats and 33 Republicans.  The House is in recess for the month of August.  The goal is to get 120 cosponsors by the time they return in September. 

We need relief from regulations coming from the CFPB and effective January 14, 2014 without relief, the regulatory burdens to manufactured home loans will impact all facets of the industry and every homeowner.

 MHI appreciates the dedicated assistance from industry members and the national network of state associations to secure co-sponsors to this important bill. For more information on the legislation, visit the MHI Web site or contact MHI Vice President of Government Affairs Jason Boehlert at jboehlert@mfghome.org or (703) 558-0660.

MHI continues to work with Sens. Sherrod Brown (D-OH) and Pat Toomey (R-PA), who respectfully serve as chairman and ranking members of the Senate Banking Subcommittee on Financial Institutions and Consumer Protection, to introduce companion legislation in the Senate.

Please take the time to contact your U.S. Representative and request they co-sponsor the legislation, Preserving Access to Manufactured Housing Act (H.R. 1779).

The Truth in Lending Act

Beginning on June 1st, 2013, The Truth in Lending Act or TILA ban on mandatory arbitration provisions in certain mortgage loans became effective.  This has effected applications received on or after the June 1st deadline.

Under this ban, lenders using the loan documentation that contains such requirements will be required to remove them for loans covered.

Now make sure you note that this bans does implement a provision of the Dodd-Frank Act.  The provision bans “terms that require arbitration or any other non-judicial procedure to resolve any controversy or settle any claims arising out of the transaction.”

Lenders using loan documentation that contains such requirements will be required to remove them for loans covered under the ban. The ban implements a provision of the Dodd-Frank Act that bans “terms that require arbitration or any other non-judicial procedure to resolve any controversy or settle any claims arising out of the transaction.”

There is more detailed information here about the regulations, Regulation Z, and additional links for more resources on this news.

Federal Regulations Planned for 2013 Will Impact Manufactured Housing

The Federal Government’s Semi-Annual Regulatory Agenda or (SAR) was published in the Federal Register on January 7th of this year.  There are many regulatory actions that will be quite significant to the manufactured housing industry this year.  Below explains some of these actions and when they are to be discussed throughout the year.

Department of Housing and Urban Development (HUD)

• May 2013 – Final rule to revise the notification, correction and procedural regulations of Subpart I of the Manufactured Home Procedural and Enforcement Regulations (24 CFR Part 3282).

• June 2013 – A final rule for on-site completion of construction of manufactured homes.

• June 2013 – A final rule to revise and update the Manufactured Home Construction and Safety Standards.

Department of Energy (DOE)

There is nothing in the SAR regarding proposed rule making for energy efficiency standards for manufactured housing because the draft rule which has been completed by DOE is pending for publication at the Office of Management and Budget (OMB).

Environmental Protection Agency (EPA)

• January 2013 – A proposed rule to establish specific national formaldehyde emission limits for hardwood plywood, particleboard, and medium-density fiberboard that are identical to the California emission limits for the same products is pending for publication at the OMB.

Consumer Financial Protection Bureau (CFPB)

Various rules either issued or planned to be issued by the CFPB are detailed in the above Dodd-Frank/CFPB update written by Jason Boehlert.

Occupational Standards Health and Safety Administration (OSHA)

• October 2013 – OSHA plans to hold panel discussions with small businesses to obtain input on its efforts to establish standards for combustible dust hazards.

(*This information is coming from Manufactured Housing Week in Review)

Congress Passed Extension Package to Avoid the “Fiscal Cliff” – Including…

 …Extension of Tax Credit for Energy Star Manufactured and Modular Homes

Congress approved legislation or the H.R. 8, the “American Taxpayer Relief Act of 2012” on January 1^st, 2013.  The legislation averted the “fiscal cliff” which extended a number of expiring tax provisions.

“Highlights of the “American Taxpayer Relief Act” include a permanent extension of the 2001 and 2003 (“Bush”) tax cuts, at least for taxpayers with incomes below certain thresholds, changes in basic tax rate structure, and extension of the capital gains tax rate structure. The estate and gift tax rules applicable in 2012 were also made permanent, and estates worth up to $5 million ($10 million for married couples) will go untaxed. In addition, a provision tying the exemption to inflation increases the estate tax exemption to estates worth $15 million for married couples by 2020.”

The “ATM patch” or the alternative minimum tax exemption amount was extended by H.R. 8 which expired at the end of 2011.  It also temporarily extended numerous American Recovery and Reinvestment Act provisions. Other provisions that will now expire at the end of 2013:

• Research and experimentation tax credit (extension and modification)

• Provisions directed at individuals

• Deduction for certain expenses of elementary and secondary school teachers

• Parity for exclusion for employer-provided mass transit and parking benefits

• Deduction for mortgage insurance

“Included in these extended tax provisions, in a significant victory for the factory-built housing industry, was the New Energy Efficient Home Credit (I.R.C. 45L) through December 31, 2013. This credit, which had expired at the end of 2011, provides builders of Energy Star-qualified manufactured homes with a tax credit of $1,000 (per home) and builders of modular homes with a credit of $2,000 (per home).” (MHI, 2013)

New Legislation in effect August 13th, 2012!

There is some very important news I want to share it with all of you…

The Financial Crimes Enforcement Network (FinCEN) which is a bureau of the US Department of Treasury, has published a final rule that requires non-bank residential mortgage lenders and originators to establish Anti-Money Laundering (AML) programs and file Suspicious Activity Reports (SARs) with them.  If your company makes residential loans;  is named as the person to whom residential mortgage loans are initially payable; sells manufactured homes using a retail installment contract; helps consumers complete credit applications; reviews the contents of a credit application; relays loans to/from consumer or residential mortgage lender; discusses specific financing terms with consumers, your company is covered by the FinCEN rule to have an Anti-Money Laundering Program (AML) and a Suspicious Activity Reporting Policy (SAR).

If your company’s activities are described in the definition of residential mortgage lender and/or loan originator, your company must comply.  The rule defines a Residential Mortgage Loan Originator (RMLO) as “A person who accepts a residential mortgage loan application or offers or negotiates terms of a residential mortgage loan.”

*Note that this is NOT related to the SAFE Act and the NMLS registered Mortgage Loan Originator (MLO) program.

The FinCEN rule is effective on August 13th, 2012 and here are very important documents you should review:

• Understanding Anti Money Laundering – Rishel
• MHI_AML_SAR_Policy_Template_2012-7-5
• FinCEN Form 104 Currency Transaction Report
• FinCEN Form 8300
• Publication 1544 Cash Reporting

“The Association has been working with MHI and others, including the Rishel Consulting Group, on the best sources of information and materials to provide to its members, including setting up conference calls and webinars. Rishel Consulting is one of a number of firms that can assist manufactured housing companies to become compliant with AML.  We are encouraging members if they determine they need to become compliant with AML regulations to do their research by going to the FinCEN website www.FinCEN.gov  and other online websites.”

“In the meantime, we are encouraging our members to read the attached materials and do a quick assessment to determine whether the FinCEN rule applies to their company.  If the company is not covered by the FinCEN rule, no further action is required.”

Two free webinars:

• Friday, July 20th at 2 p.m. Eastern time, hosted bey Rainmaker Consulting & Rishel Consulting Group
• Monday, July 23rd at 2 p.m. Eastern time, hosted by MHI

To register go here: https://www1.gotomeeting.com/register/314920736

*The New York Housing Association makes no warranties or guarantees, either express or implied, with respect to the content, products and services provided by either the Manufactured Housing Institute (MHI), Rainmaker Consulting or the Rishel Consulting Group.  The Association shall not be liable to any member or other party for the use of the information, products or services provided, and expressly disclaims all liability arising therefrom.

 

Monday, July 23rd at 2 p.m. Eastern

A Survey and other Important Information

Some very important information has been coming down the pipeline and I wanted to share it with you immediately.

The Treasury Department’s Financial Crimes Enforcement Network (FinCEN) issued a final rule  about extending anti-money laundering (AML) and suspicious activity reporting (SAR) requirements to non-bank residential mortgage lenders and originators (RMLOs – Additional information is here about defining a RMLOs, etc. FINcen Final AML Rule for Non-Bank Mortgage Lenders 2-17-2012).  Now by August the RMLOs will be required to implements AML and SAR programs.

MHI working with McGlinchey-Stafford to create templates to assist lenders, community owners and retailers in becoming compliant with this rule.  We are asking MHI members to complete the survey in a PDF (NOLADB-#998207-v1-MHI_Member_Questionnaire_for_AML_and_SAR_Programs) or in a Word document MHI_Member_Questionnaire_for_AML_and_SAR_Programs.

In addition, we are requesting that lenders and also MHI members that could possibly be considered RMLOs such as community owners/operators, manufactured housing retailers, etc. to complete the survey.

Please follow the directions and note the information within the survey is kept strictly confidential.  Please return at your earliest convenience.  You can return your survey to Marc Lifset at mlifset@mcglinchey.com or by fax at 518.432.7290.  Feel free to contact Marc if there are any questions about the survey.  Your assistance will help us all more easily comply with this new regulatory requirement.

Manufactured Housing Finance Relief Legislation Unveiled

This post is from an email via The Manufactured Home Industry.  This email is so important that I decided to post it word-for-word because it is quite important to our industry and could have not said it better myself.  *Note it is quite a lengthy post but important.

____________________

(Arlington, VA – February 1, 2012) – “During a hearing of the Financial Services Subcommittee on Insurance, Housing and Community Opportunity evaluating the effectiveness to which the Department of Housing and Urban Development (HUD) has implemented key provisions of the Manufactured Housing Improvement Act of 2000, Rep. Gary Miller (R-CA) formally unveiled legislation (H.R. 3849) to reduce regulatory burdens impeding access to affordable manufactured housing financing”.

“In detailing challenges facing the manufactured housing industry, Congressman Miller cited a number of difficulties the industry has suffered over the past decade, including: a decline in new manufactured home construction of roughly 80 percent; the closure of more than 160 plants; and the loss of over 200,000 jobs.  He specified that “Congress must address the problems with regulatory overreach that impedes the ability of consumers to obtain mortgage financing for manufactured homes.”

The bill (titled the Preserving Access to Manufactured Housing Act) was developed on a bipartisan basis by Reps. Joe Donnelly (D-IN), Stephen Fincher (R-TN) and Gary Miller, in consultation with the Manufactured Housing Institute (MHI), to address two significant issues impacting the manufactured housing industry:

• Reducing the threshold by which small balance manufactured home personal property loans are considered High-Cost Mortgage Loans under provisions within the Dodd-Frank Wall Street Reform and Consumer Protection Act (P.L. 111-203) and thereby subject to punitive and onerous liabilities.

• Clarifying that those selling manufactured homes—who are not fundamentally engaged in the business of mortgage origination —are not to be considered mortgage originators under the federal SAFE Act and thereby better able to provide adequate technical assistance to consumers throughout the manufactured home buying process—similar to the SAFE Act treatment of real estate brokers.

Upon introduction of the legislation, MHI Chairman and Cavco Industries Chairman and CEO Joe Stegmayer stated “we are truly grateful for the dedicated leadership and work of Representatives Joe Donnelly, Stephen Fincher and Gary Miller on this very important issue.  Serving the financing needs of the manufactured housing market has always been a unique challenge.   It has grown more challenging by the establishment of new federal guidelines that do not adequately account for the complexities and realities facing the industry and consumers alike. The legislation is an essential step in preserving the affordability advantage of manufactured housing and protecting the equity that 19 million existing manufactured home residents have built in their homes.”

During the hearing, several members of the subcommittee reaffirmed the important role manufactured housing plays as an affordable, high quality housing source and the need for improved access to financing, including Rep. Robert Hurt (R-VA) who stated that the manufactured housing industry has been “hindered by a lack of financing availability.”  Rep. Sean Duffy (R-WI) highlighted the valuable role manufactured housing plays as an “important source of affordable housing” that is “threatened by a lack of financing options.”

In his testimony, Cavco Industries Director of Engineering Manuel Santana, P.E. – testifying on behalf of MHI – reinforced these points and stated that “the single most important issue impacting the manufactured housing market remains the availability of accessible and affordable financing for those seeking to purchase manufactured housing.”  Mr. Santana added that “lack of a viable secondary market for manufactured home loans coupled with growing regulatory burdens threaten to further constrict the limited financing options that currently exist within the manufactured housing market.”

MHI will continue to work on a bipartisan basis to educate Members of Congress and develop solutions to the financing crisis within the manufactured housing market.  For a copy of the legislation, click here.  A description of the bill’s impact on SAFE Act and the Dodd-Frank Act is available here.

MHI is the preeminent national trade association for the manufactured and modular housing industries, representing all segments of the industry before Congress and the Federal government. From its Washington, D.C. area headquarters, MHI actively works to promote fair laws and regulation that will help provide quality, affordable housing for homebuyers. For more information on MHI, visit www.manufacturedhousing.org.

Reauthorization of Preferential Tax Treament of Imported Lumber

Guess what?  Good news is on the forefront.  “After months of delay, manufactured home builders will now be able to purchase imported lumber duty free!”  President Obama signed legislation to reauthorize the U.S. Generalized System of Preferences (*GSP).  The program will be upheld from October 21, 2011 through July 31st, 2013.

The expiration date of the program was December 31, 2010.  The delay in reauthorizing the program was upheld by a controversy created by the impact on one U.S. producer of one product imported from one GSP beneficiary.  The lapse in the program also concluded in substantial increases in the cost of plywood and other lumber materials.

Sherry Norris – Executive Director of the Alabama Manufactured Housing Association – initiated a grassroots lobbying effort to reauthorize the GSP.

*The GSP is a program that provides preferential duty-free entry for up to 4,800 products including lumber, from 129 designated beneficiary countries and territories.

The Dodd-Frank Act and Manufactured Housing

July 21st is soon approaching and that means change is coming to multiple industries.  The Bureau of Consumer Financial Protection (CFPB) “will officially assume its oversight position over the nation’s banking and financial system without an official director in place” (MHI News).

How is this important?  The Dodd-Frank Act gives the CFPB the permission to oversee non-bank financial firms which can and most likely will impact the manufactured housing industry.  Although, the agency is prohibited from starting to oversee non-bank financial firms (places that provide for example student, payday and mortgage loans) without a confirmed director.

To add more confusion and controversy to the act, Republican members of the Senate “have indicated they would place a hold on any nominee to head up the agency until substantive changes impacting the governance and operations of the CFPB are made” (MHI News).

It will be an interesting week for this specific act and in the Senate.  We will keep you posted as we obtain information and developments.

Thanks,

M. Cicardi