Homeowners who live in mobile home parks are paying anywhere from 8-15% interest on their mortgages- way more than people who own other types of housing.
That only makes it harder to pay the bills for those homeowners who often live on moderate or fixed incomes.
But home mortgage giant Fannie Mae and local banks are starting to look at some of these communities in a new way.
New Hampshire Public Radio’s Dan Gorenstein reports.
DG: Lilac Drive is a small 26 home housing park in Raymond.
Sfx: paint scrapping
DG: One couple scrapes peeling blue paint....farther down workers lay pipe...two girls walk a dog past well-tended yards.
Nancy Hollinrake remembers her first impression of the park 10 years ago.
TAPE: we just loved the whole area. It was so well kept...neat, nice looking.
DG: Back in 1998, Nancy’s legs were acting up, making stairs hard for the retired school teacher.
So, she and her husband downsized into a home on Lilac Drive.
She never thought twice about financing.
TAPE: You know, you buy a house, and that’s it. you go to the bank, you get the mortgage, get your insurance and move in.
DG: But even the bank her father helped found it didn’t go like that.
TAPE: the bank that I had dealt with for years, in fact my father had been one of the founders of this bank...said to me, ‘we can’t help you Nancy.’ I said, ‘what do you mean, can’t help me?’ ‘No we don’t deal in those types of places.’ I said, ‘what do you mean those kind of places?’ ‘No, no we can’t do that.’
DG: Fast forward to today, 1/3rd of the Hollinrake’s fixed monthly income goes for housing costs.
Nancy- who has diabetes and arthritis so severe that she relies on a wheelchair- could see a cut in her health benefits later this year.
Her husband Wes says that could be a problem.
TAPE: If it does run out, let’s put it that way, then we are going to be in a tight situation, very tight. In fact it could mean losing the home..(sigh)..but we can only take it day to day, one day at a time.
DG: The Hollinrake’s tight budget aggravated by above market mortgage rates- is a familiar predicament for people in mobile home parks.
Traditional lenders have consistently offered more expensive mortgages for a few reasons.
One, people usually own the actual home, but rent the land their place sits on.
That means the park owner could give tenants 30 days notice, sell the place, and leave the bank holding a mortgage on a property that-despite the name- isn’t terribly mobile.
Merrimack County Savings Bank President Paul Rizzi says the other problem is that many homes weren’t built to last and are pretty shabby.
TAPE: a unit that might be 20 years old, and is 2x4 construction with a flat roof and sagging b/c it’s had snow on it for a number of years. And the risk is this thing is going to cave in.
DG: But a lot has changed in the past 25 years.
Today what people are beginning to call ‘manufactured homes’ are built to federal standards.
And in New Hampshire 20% of all parks are resident owned cooperatives.
Here, the non-profit New Hampshire Community Loan Fund has provided residents with technical and financial help to buy the parks.
Uniformly, coop conversions have led to road and septic upgrades and community-wide facelifts.
The changes have impressed Fannie Mae, the nation’s largest source for financing home mortgages.
TAPE: it represents an untapped market of over 3.5 million families. This is just something that makes sense for us.
DG: Fannie Mae’s Bob Simpson is so convinced that the people who live in the coops are a good investment; the company has agreed to help offer conventional mortgages to residents in 36 New Hampshire coops.
Fannie Mae will work with Manchester-based St. Mary’s Bank and Concord-based Merrimack County Savings Banks to pilot a 5 year, 10 million dollar project.
Simpson expects things to go so well, that the New Hampshire model will be rolled out nationally.
In the short-term, the project means a homeowner can refinance and save some money.
The prospect of building wealth for people in the parks thrills Community Loan Fund director Julie Eades.
TAPE: how often do you get to tweak capitalism? There just isn’t anything more satisfying than being able to level that playing field by changing how people act in the market, and how that market works for them.
DG: The Hollingrake’s have been waiting for a level playing field for ten years.
They are looking to refinance their mortgage as soon as possible.
That way, Wes says Nancy can go on enjoying the electric recliner under the skylight.
The place she likes to watch the clouds float by.
For NPR News, I’m DG in Concord, NH.
