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FNMA Mobile Home Park Loan 

Nationwide

Financing acquisition or refinance of stabilized mobile home parks where borrower owns the Manufactured Housing Community (MHC) sites, associated common amenities, infrastructure and leases individual pad sites to owners of the manufactured homes.

$1 Million+ to $100 Million

4.25% to 6.75%

Term: 5 to 30 years

Amortization: 30 years for age restricted or family communities

LTV: 80%; if purchased within past 12 months, 80% of lower of appraisal or purchase price (up to 3% of closing costs) plus value added renovation

Non-recourse 

Pricing incentives for Communities with Tenant Site Lease Protections starting at 25% of Sites with an increased incentive for Lease Protections on 50% of Sites or owned by non-profit entity (see below for required lease protections).

Flexible prepayment options: may be voluntarily prepaid upon payment of yield maintenance for fixed-rate loans and graduated prepayment for variable-rate loans.

Property Considerations*

  • Existing, stabilized, professionally managed MHC with or without age restrictions 
  • 50+ sites
  • Quality Level: 3, 4, 5 communities.
  • Tenant-occupied homes not to exceed 25% (35% under certain conditions).
  • Density not to exceed 12 Manufactured Homes per acre for an existing community and 7 Manufactured Homes per acre for a new community.
  • Homes professionally skirted with hitches removed or covered.
  • Completion escrow can be used to bring park into compliance.
  • Prefer 2 off-street paved parking spaces. On-street parking subject to local ordinance.
  • Paved roads.
  • Manufactured Homes should conform to applicable Manufactured Housing HUD Code standards.
  • Community must have underground public utilities or licensed private sewage treatment plant, septic system or private water well.
  • Leases 2 year term+
  • No tenant options to purchase site.
  • Further review if in flood zone.

*Note: Communities not meeting above characteristics considered case-by-case.

3rd Party Reports: MAI Appraisal, Property Condition Assessment and Environmental Phase I required

Third Party Reports Cost Reimbursement: Fannie Mae reimburses cost of third-party reports up to $10,000 for Communities with Tenant Site Lease Protections implemented for at least 50% of Sites or if community owned by non-profit entity.

Minimum site lease protections must include:
(a) One-year renewable lease term for site, unless good cause for nonrenewal;
(b) 30-day written notice of site rent increases;
(c) 5-day grace period for site rent payments and right to cure defaults on site rent
(d) Rights of tenants to:
(i) Sell manufactured home without having to first relocate it out of the community;
(ii) Sublease home or assign site lease to new buyer who meets minimum MHC rules, regulations and borrower’s credit standards for new tenants, consistent in the market;
(iii) Post “for sale” signs that comply with MHC rules and regulations;
(iv) Sell home in place within 45 days after eviction; and
(v) Receive at least 60 days advance notice of planned sale or closure of community.

Tax & insurance escrows depend on leverage level. Replacement reserve escrow not required.

Application Fee: $15,000 to cover third party reports and processing/underwriting costs

Rate Lock: 30 to 180 day commitments. Borrowers may lock a rate with Streamlined Rate Lock option.

Accrual 30/360 and Actual/360

Non-recourse execution with standard carve-outs for “bad acts” such as fraud and bankruptcy. For loans with pricing incentive for having minimum Tenant Site Lease protections, a Limited Payment Guaranty for 10% of Mortgage Loan amount required.

Assumable subject to review and approval of new borrower’s financial capacity and experience.

Supplemental Financing available one-year after loan origination

Minimum Underwritten Vacancy/Collection Loss: Minimum 5% economic vacancy assumption.

Borrower Eligibility: At least one Key Principal of Borrower should have experience operating MHC’s.

Let’s Move your project forward…

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