New regulations by the mortgage giant, Fannie Mae, will impact thousands of mobile home buyers.
Because of a growing number of delinquent loans, the finance company will now require a ten percent down payment on 30 year mortgages.
The new restrictions put a pinch on an already struggling manufactured housing industry.
Manufactured housing offers an affordable alternative for buyers who can't afford conventional homes. But the new Fannie Mae restrictions may push some customers out of the market.
Wendy Ladner helps sells and finance manufactured homes for American Family Home Center.
"They had like different down payment programs and different things for customers and now they're taking those things away and are going to require ten percent, which is what the other types of lenders do, and so it makes it a lot more difficult for the people who don't have that type of down payment. They just won't be able to have a home," said Ladner.
The manager of Regency Homes says the impact of the restrictions isn't quite as gloomy as the threatening weather which hung over his business Monday morning. Mitch Cannavino says alternative financing, like FHA loans, still offers affordable mortgages.
"It's a harder loan to do, so most people stay away from it since it's more intensive on the paperwork. But as other programs tightened up on manufactured housing, we gravitated toward that, since it's regulated by HUD which our product is regulated by, so it's a natural match," he explained.
Manufactured housing accounts for nearly one third of all new home sales. And the Fannie Mae financing regulations will extend beyond the federal government. Many private financial institutions adopt Fannie Mae guidelines for their home loans.
"Now it's not a Fannie Mae loan, but they still require it, so that they feel like they've made a good safe loan," said Ladner.
Nationwide, the manufactured housing business has been struggling in recent years. Dealers worry the tougher mortgage restrictions won't help.
Fannie Mae is short for the Federal National Mortgage Association. It's the nation's largest source of money for mortgages, with many of the loans going to first time home buyers.