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Wednesday, February 3, 2016

THE WEALTHY CONTINUE TO MAKE IT DIFFICULT FOR HOMEOWNERS -- EVEN OWNERS OF MOBILE HOMES



The Seattle Times' ongoing investigation of the mobile home industry (along with BuzzFeed News and the Center for Public Integrity) - begun after media alerted consumers last December about how Clayton Homes (a company owned by Warren Buffett's Berkshire Hathaway) systematically targets minority borrowers and charges them higher rates - has Washington state Gov. Jay Inslee calling for the state legislature to find ways to protect our 450,000 mobile home residents from abusive sales and lending practices in the mobile-home industry.  [I'm not clear whether this includes manufactured homes. I will check and revise this posting.]  When people fall behind on their loans, Clayton Homes, a company that dominates mobile-home lending, sales and manufacturing (AND SELLS THEM THROUGH A NETWORK OF MORE THAN L,600 DEALERSHIPS) repossesses the homes and resells them (presumably, rather than working with the homeowners to stay in their homes).  They also finances more than a third of all mobile-home loans, more than any other lender by a factor of seven, according to the Times' article.

A bill sponsored by Representative Cindy Ryu and backed by Governor Inslee would give consumers more protections from excessively high interest rates and foreclosures by mobile home lenders.  According to today's article in The Seattle Times ["MOBILE HOMES GET INSLEE'S ATTENTION/Calls for State Study, Feb, 3, 2016], "a bill backed by Gov. Inslee and the state Department of Commerce calls for a study of how the industry sells, finances and repossesses the homes.  Supporters say state laws that protect conventional homebuyers typically do not safeguard people buying homes.  Commerce director Brian Bonlender said the key difference is that mobile homes are typically financed with personal-property loans.  They want to find ways to "stop unfair practices that could leave some Washington homeowners out in the cold."

"The consumer protections around those are much less significant," Bonlender said in an interview.  Unlike mobile-home puchasers, buyers of conventional homes in Washington enjoy extended timelines to resolve financing problems and foreclosure mediation, he said.

The nation's leading mobile-home company extracts billions of dollars from poor customers by deceiving them about loan terms and charging high rates of interest.

Nationwide, nearly 18 million people live in mobile homes, the article reported.


At the federal level, lobbyists for the mobile-home industry tried to roll back consumer protections but the bill stalled.  Last April, the U.S. House of Representatives approved a  bill that would raise the interest-rate thresholds at which additional consumer protections would take effect.  The bill would overwhelmingly help Clayton Homes.  The proposal was also included in a larger U.S. Senate bill in 2015 that was approved in a committee, but it did not make it to the Senate floor for a vote.



Sources:

Seattle Times/reporters Mike Baker and Daniel Wagner, Feb, 3, 2016
BuzzFeed.com
Center for Public Integrity.com


On the Web, read The Mobile-Home Trap series: seattletimes.com/category/mobile-homes/