Daily Rules, Proposed Rules, and Notices of the Federal Government


[Docket No. FR-5319-N-01]

Federal Housing Administration (FHA) Title I Manufactured Home Loan Program:Notification of Availability of Program Reform Implementation and Request for Comments

AGENCY: Office of the Assistant Secretary for Housing--Federal Housing Commissioner, HUD.
ACTION: Notice.
SUMMARY: HUD has issued a 2009 Title I Letter 2009 to implement the reforms that were made to the Title I Manufactured Home Loan Program pursuant to the FHA Manufactured Housing Modernization Act. The letter is available this notice, HUD solicits comments on the implementation of these reforms as presented in the letter. HUD will take these comments into consideration in the development of a final rule that will follow the letter, and codify in regulation the reforms to the Title I Manufactured Home Loan Program.
DATES: Comment Due Date:June 22, 2009.
ADDRESSES: 1. Submission of Comments by Mail.Comments may be submitted by mail to the Regulations Division, Office of General Counsel, Department of Housing and Urban Development, 451 7th Street, SW., Room 10276, Washington, DC 20410-0500.

2. Electronic Submission of Comments.Interested persons may submit comments electronically through the Federal eRulemaking Portal strongly encourages commenters to submit comments electronically. Electronic submission of comments allows the commenter maximum time to prepare and submit a comment, ensures timely receipt by HUD, and enables HUD to make them immediately available to the public. Comments submitted electronically through thewww.regulations.govWeb site can be viewed by other commenters and interested members of the public. Commenters should follow the instructions provided on that site to submit comments electronically.

FOR FURTHER INFORMATION CONTACT: For information contact, Margaret Burns, Director, Office of Single Family Program Development, Office of Housing, Department of Housing and Urban Development, 451 7th Street, SW., Room 9278, Washington, DC 20410-8000; telephone number 202-708-2121. (This is not a toll-free number.) Persons with hearing or speech impairments may access this number through TTY by calling the toll-free Federal Information Relay Service at 1-800-877-8339.

The FHA Manufactured Housing Loan Modernization Act of 2008 (Subtitle B of Title II of the Housing and Economic Recovery Act of 2008; Public Law 110-289, approved July 30, 2008) (Act), amended various provisions in section 2 of Title I of the National Housing Act (12 U.S.C. 1703et seq.) relating to the Manufactured Home Loan Program for the purpose of providing: (1) Adequate funding for FHA insured manufactured housing for low and moderate income homebuyers, (2) modernizing 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.

The Act revised the FHA Title I Manufactured Home Loan Program by:(1) Increasing the loan limits and establishing indexing for future adjustments based on inflation, (2) changing the insurance type from portfolio insurance to individual loan insurance, (3) providing that insurance on each individually Title I insured manufactured home loan be incontestable, except for fraud or misrepresentation, (4) changing the method for calculating the insurance premium by allowing for both an upfront insurance premium, not to exceed 2.25 percent, and an annual insurance premium to be paid during the term of the loan, not to exceed 1.0 percent, (5) revising the underwriting criteria for loans and advances of credit in connection with the Title I manufactured home loan products as may be necessary to ensure that the program is financially sound, and (6) requiring a leasehold agreement if a manufactured home unit is to be situated in a manufactured home community. The term of the lease must not less than 3 years, renewable upon expiration of the original term by successive 1 year terms. The lessor must provide the lessee written notice of termination of the lease not less than 180 days prior to expiration of the current lease.

A Title I Letter has been issued to implement these reforms. HUD requests comments from lenders and other interested parties with regard to the implementation of these reforms. All comments received will be reviewed and considered by HUD in its development of a rule amending the Title I Manufactured Home Loan Program regulations at 24 CFR part 201. The rule will adopt the letter as issued or as may be revised pursuant to public comment or further consideration by HUD. Although FHA welcomes comments on all aspects of the Title I Letter, it is especially interested in receiving comments concerning upfront and periodic insurance charges, the methodology for indexing so as to be able to annually adjust the maximum loan limits, the underwriting criteria, and the potential economic costs and benefits of the reforms contained in the letter.

Comments must be submitted by the deadline date established in theDATESsection of this notice, and in accordance with the instructions contained in theADDRESSESsection of this notice.

Dated: April 14, 2009. Brian D. Montgomery, Assistant Secretary for Housing—Federal Housing Commissioner.