Manufactured Housing Communities & Resident Co-Ops
Manufactured Housing Communities (MHC)—historically called mobile home parks—deliver essential, unsubsidized affordable homeownership to millions of American families, seniors, and retirees. In a typical land-lease MHC, residents own their manufactured homes and pay monthly pad rent to lease the underlying land and utility infrastructure. BancorpOne arranges low-cost, long-term financing—including non-recourse Fannie Mae and Freddie Mac MHC loans, balance-sheet bank facilities, and specialized Resident-Owned Community (ROC) cooperative debt.
Indicative Underwriting Matrix
Underwriting evaluates utility infrastructure ownership (municipal vs. private septic/well), road paved condition, pad occupancy, and resident tenant lease agreements.
Exceptional Tenant Stickiness and Low Capital Expenditure Underwriting
Manufactured Housing Communities represent one of the lowest-risk asset classes in commercial real estate. Because moving a modern manufactured home costs $6,000 to $12,000+, tenant turnover is virtually non-existent (averaging under 3% annually). Residents take pride in homeownership, maintaining their individual dwellings and landscaping.
For property owners, capital expenditures are exceptionally low compared to traditional multifamily buildings. The owner is not responsible for interior plumbing, appliances, HVAC units, or drywall maintenance—only the common infrastructure: private streets, clubhouse amenities, and master utility lines.
- Non-recourse Fannie Mae and Freddie Mac financing with up to 80% LTV and low interest margins
- Pad-lease models minimize operating CapEx; tenants own and maintain their residential homes
- Finances 3 to 5-star institutional communities as well as value-add parks with utility conversion needs
- Specialized financing available for Resident-Owned Communities (ROC) and cooperative land trusts
Private Utility vs. Municipal Water and Sewer Due Diligence
Underwriters scrutinize park utility systems. Communities connected to municipal city water and sewer receive preferred loan pricing and higher leverage. Parks operating on private water wells, lagoon wastewater systems, or on-site septic tanks require comprehensive environmental engineering reports, water quality tests, and reserve escrows for future municipal hookups.
Frequently Answered Financing Questions
Verified answers to common borrower and broker inquiries regarding loan sizing, guidelines, and execution.
Why do Agency lenders favor Tenant-Owned Homes (TOH) over Park-Owned Homes (POH)?
Lenders prefer tenant-owned homes because pad-lease tenants maintain their own properties, drastically lowering landlord operating expenses and turnover.
Park-owned rental homes act like traditional apartments with higher maintenance costs and shorter tenant occupancies.
Size an MHC Loan →Can you finance a mobile home park on private septic and well water?
Yes. While municipal utilities qualify for lower interest rates, lenders finance private utility parks with third-party engineering inspections.
Operating permits, water testing logs, and replacement reserve escrows are required to protect environmental compliance.
Review MHC Guidelines →