Freddie Mac Manufactured Housing Community Loans

Freddie Mac Manufactured Housing Community loans serve as primary financing for mobile home parks and other manufactured housing communities. Such communities are common throughout much of semi-rural and rural America.

For communities that qualify, this Freddie Mac loan program has competitive rates and advantageous terms. They can be used to expand or improve an existing community.

Many existing manufactured housing communities that aren’t age-restricted can qualify for these Freddie Mac loans. Although most of these communities are in more rural settings, urban communities are also eligible to participate in the loan program.

Some examples of communities that could likely qualify for a Freddie Mac Manufactured Housing Community loan include mobile home parks, land-leased communities, resident-owned communities, investor-as-owner communities, income-restricted communities, luxury communities, and some specialty manufactured home communities.

Age restrictions are technically allowed, but senior communities for 55+ or 65+ are excluded. RV campgrounds likewise don’t qualify. Up to 25% of a community’s homes can be leased. (All of the land can be leased.)

In order to qualify, borrowers must have at least one year of professional manufactured home management experience.

Notably, the loan program also requires that community owners grant tenants certain protections (see below).

Within a year of securing financing, community owners must provide all tenants with certain protections. These protections must be included in all leases and community regulations.

The stipulated protections require one-year renewable leases, 30-day notice of rent increase, 5-day payment grace period, right to sell, right to sublease, and a few other protections. They don’t prevent owners from increasing rents, provided the necessary 30-day notice is given.

Freddie Mac’s loans for manufactured housing can be structured with fixed or variable interest rates. The rates are based on current market rates. Additionally, there are partial-term and full-term interest-only loans available.

Freddie Mac Manufactured Housing loans are non-recourse with standard bad-boy carve-outs. Community owners generally can’t be held personally liable if a property defaults or otherwise doesn’t pay back its loan.

Freddie Mac Manufactured Housing loans are intended for existing manufactured housing communities. They can’t serve as financing for the construction of new communities. They can be the primary financing for a relatively new community that is previously established.

Lenders that underwrite Freddie Mac Manufactured Housing loans may be referred to as Optigo partners. This is the agency’s nomenclature for partnering lenders that work on complicated situations, such as manufactured housing communities.

Commercial residential real estate loans are normally for properties that have a minimum of 5 units (and possibly many, many more). This equates to 5 pad sites for manufactured housing loans.