USDA sigik_. mom. Ru ra I. Development. United States Department of Agriculture. Rural Development

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1 TO: State Directors* Rural Development USDA sigik_ mom Ru ra I Development United States Department of Agriculture Rural Development August 12, 2016 ATTENTION: Rural Housing Program Directors Rural Housing Specialists Area Directors and Specialists FROM: Tony Hernandez Administrator Rural Housing Service SUBJECT: 502 Single Family Housing Direct and Guaranteed Existing Manufactured Housing Unit Financing Pilot PURPOSE/INTENDED OUTCOME: The purpose of this Unnumbered Letter (UL) is to establish a pilot program for the financing of existing manufactured housing units with the Section 502 Direct and Guaranteed programs for a period of 24 months. Currently, only new units or existing manufactured housing units that are already financed through Rural Development (RD) are eligible for financing through the SFH 502 Direct and Guaranteed programs. Units financed under this Pilot must have been constructed on or after January 1, Existing Manufactured Housing Pilot Guidelines The Existing Manufactured Housing Pilot is available to eligible applicants in selected states for the purchase of existing manufactured housing units that meet the criteria set forth in this UL. The states selected to participate in this Pilot are Colorado, Louisiana, New York, Ohio, Texas, Vermont/New Hampshire and Wyoming. Additional states may be added upon request at the discretion of the Deputy Administrator, Single Family Housing. *Colorado, Louisiana, New York, Ohio, Texas, Vermont/New Hampshire, and Wyoming 1400 Independence Ave, S.W. Washington DC Web: Committed to the future of rural communities. "USDA is an equal opportunity provider, employer and lender." To file a complaint of discrimination, write USDA, Director, Office of Civil Rights, 1400 Independence Avenue, S.W., Washington, DC or call (800) (Voice) or (202) (TDD).

2 To be eligible for financing under this Pilot the existing manufactured housing units, including new units which have been on the dealer's lot in excess of 12 months, must meet the following guidelines in addition to those already set forth for new Guaranteed manufactured units in 7 CFR Part 3555, Section and Chapter 13 HB and for Direct loans Section 3: Manufactured Homes [7 CFR ] Handbook 3550, Section 9.16: The unit must have a floor area of not less than 400 square feet. The unit must have been constructed on or after January 1, 2006, in conformance with the Federal Manufactured Housing Construction Safety Standards (FMHCSS), as evidenced by an affixed HUD Certification Label. The unit must meet the Comfort Heating and Cooling Certificate Uo Zone value for the location according to Attachments 9-A and 9-B (HB ). The unit inspection is required and will utilize Form HUD 309, "HUD Manufactured Home Installation Certification and Verification Report" completed in accordance with 24 CFR by a qualified party as follows: 1) A manufactured home or residential building inspector employed by the local authority having jurisdiction over the site of the home, provided that the jurisdiction has a residential code enforcement program; 2) A professional engineer; 3) A registered architect; 4) A HUD-accepted Production Inspection Primary Inspection Agency (IPIA) or a Design Approval Primary Inspection Agency (DAPIA); or 5) An International Code Council certified inspector. The unit must not have had any alterations or modification to it since construction in the factory. The towing hitch and running gear must have been removed. The manufactured home must be classified and taxed as real estate. Lenders are responsible for ensuring the title has been purged and the manufactured home has been officially converted from chattel to real property, as state law allows. The remaining economic life of the property must meet or exceed the 30 year term of the proposed loan. The unit replacement cost coverage in an amount equal to the insured value of the improvements or the unpaid principal balance is required with hazard or wind deductible(s) of up to but not exceeding the greater of $1,000 or one percent (1%) of the policy limits until the loan is paid in full. The applicant(s) and property must meet all other criteria set forth in 7 CFR Part 3555 and HB for Guaranteed loans and 7 CFR Part 3550 and HB for Direct loans as applicable. Guaranteed loan applications submitted under this UL must be manually underwritten. Agency staff will need to select "MANUFACTURED (PILOT)" for "Construction Type" in the Property Information section in GLS as shown below. This will allow for proper identification of these Pilot loans for tracking and monitoring purposes.

3 Property Information Address 239 CHAPMAN ST County PAW PAW, IL LEE Select ON SITE MODULAR/PANELIZED MANI IFACTI infn Dwelling Construction Tvoe MANUFACTURED (PILOT) For Direct loans Agency staff will select Program Type Code 1014 (Very Low Income) or 1015 (Low Income), "Construction Type "Manuf/Home" and Dwelling Type "Purchase Old, Refinance, Purchase Old/Repair, or Refinance/Repair" in UniFi as shown below. This will allow for the proper identification and tracking of these loans under this Pilot. C.LiniFi Application - Prod FRP4I - - File Edit Record Menu Tools Help Efl Prequal Menu Elit Registration - Processing E13-- Credit Bureau g - Underwriting ; Max Ln/Pymt Assist Criteria Eligibility Determination Work Participating Maximum Loan ' -Account Conditions File Main Stage Updating -Approved Loan Terms Adverse Action ; Auto Task Rule Status Scree 9 Appraisal Workflow Property Appraiser Builder Information Detail Property Condo Informatio I Property Appraisal Appraisal Conditions Special Flood Hazard Scri USDA ELIGIBILITY Link RD-LEAD BASED PAINT RD-FIRST AMERICAN FL USDA ADDRESS VERIFI PRINT Underwriting Forms USDA INCOME CALCULATC Eil1170.kg Pull IJtiIrty Ogl IV 12:1 Property Appraisal IM:=2111 I Property has a Den I Property has Central Air Square Footage Sewer Water Type of Improvements Location Code Construction Type I I not maintained I not maintained Additions I not maintained I M anuf/home Dwelling Type Pro Jetty Ao 3ralsal Number of Rooms Type of Dwelling 'Withdrawn I Number of Bedrooms Number of Baths Number of Carports Size of Garage Basement code Square Feet (Living) Number of Stories I not maintained The corresponding dwelling type codes in the MortgageSery (RH 0) follow: 3=Purchase Old, 4=Refinance, 6 Purchase Old/Repair 7=Refinance/Repair

4 If State offices have any questions, please contact Kevin Smith of the Guaranteed Loan Division at (517) , extension 220, or via at or Tammy Repine of the Direct Loan Division at (360) , or via at

5 HUD Manufactured Home Installation Certification And Verification Report U.S. Department of Housing and Urban Development Office of Manufactured Housing Programs OMB Approval No Expires 04/30/2018 The Manufactured Housing Installation Program Regulations 24 CFR Chapter XX Part 3286 Sections 111 and 411 require the licensed installer certify that the manufactured home has been installed and inspected in accordance with the regulations. The Manufactured Housing Installation Program Regulations 24 CFR Chapter XX Part 3286 Subpart F requires a qualified inspector verify that the manufactured home has been installed in accordance with the requirements of Part 3286 and Part The information collected here will ensure that the licensed installers and qualified inspectors inspect the minimum elements for compliance. The public record burden for the collection of information is estimated to average 3.5 hours per response including the time to review instructions, search existing data sources, gather and maintain the data needed, and complete and review the collected information. Response to this information is mandatory. This agency may not collect this information, and you are not required to complete this form, unless the form displays a currently valid OMB control number. Certification Label Number(s) (include all zeros and agency prefix) Manufacturer s Serial Number(s) (include all letters and numbers) (Installer Name) (HUD License No.) (Homeowner Name) (State) (Inspector Name) (State) (Street Address) (City) (Zip) 1. Initial Inspection (Street Address) (Phone) Inspection Item Inspector Verification Installer Certification Site location with respect to home design and construction Pass Fail N/A Pass Fail N/A Consideration of site specific conditions Pass Fail N/A Pass Fail N/A 24 CFR 3285 Subpart C - Site preparation and grading for drainage Pass Fail N/A Pass Fail N/A 24 CFR 3285 Subpart D - Foundation construction Pass Fail N/A Pass Fail N/A 24 CFR 3285 Subpart E - Anchorage Pass Fail N/A Pass Fail N/A 24 CFR 3285 Subpart F - Optional features (Skirting, etc.) Pass Fail N/A Pass Fail N/A 24 CFR 3285 Subpart G - Completion of ductwork, plumbing, and fuel supply systems Pass Fail N/A Pass Fail N/A 24 CFR 3285 Subpart H - Completion of electrical systems Pass Fail N/A Pass Fail N/A 24 CFR 3285 Subpart I - Exterior and interior close-up Pass Fail N/A Pass Fail N/A Completion of operational checks and adjustments Pass Fail N/A Pass Fail N/A 2. Reinspection of Home (To be completed and initialed by the inspector) If the inspector discovers that any item during the Initial Inspection fails to comply with the manufacturer s installation instructions or with an installation design and instructions that have been certified by a professional engineer or registered architect, the installation must be reinspected after the installation is corrected. Briefly describe the work that did not pass the initial inspection. Upon reinspection, inspector must initial item(s) that are in compliance. Attach additional sheet(s) if necessary. 3. Inspector Verification I have performed a visual inspection in accordance with 24 CFR , of the manufactured home installation identified above. I have inspected the minimum elements noted above, as required by 24 CFR and the items above have been installed in accordance with an installation design and instructions that have been provided by the manufacturer and approved by the DAPIA or an installation design and instructions that have been prepared and certified by a professional engineer or registered architect that have been approved by the manufacturer and the DAPIA as providing a level of protection for residents of the home that equals or exceeds the protection provided by the federal installation standards in part 3285 of this chapter. It is a crime to knowingly make false statements in any matter within the jurisdiction of the United States such as the verification statement on this or any similar form. Penalties upon conviction can include a fine and imprisonment. See 18 U.S. Code Section Inspector Signature (Date) 4. Installer Certification I hereby certify, in accordance with 24 CFR and , that the manufactured home identified above has been installed in accordance with an installation design and instructions that have been provided by the manufacturer and approved by the DAPIA or an installation design and instructions that have been prepared and certified by a professional engineer or registered architect that have been approved by the manufacturer and the DAPIA as providing a level of protection for residents of the home that equals or exceeds the protection provided by the federal installation standards in part 3285 of this chapter. It is a crime to knowingly make false statements and/or certifications in any matter within the jurisdiction of the United States such as the certification on this or any similar form. Penalties upon conviction can include a fine and imprisonment. See 18 U.S. Code Section Installer Signature (Date) Distribution: Form HUD Installer Retailer Purchaser