The following are the primary reasons
for the VMBA supporting the appeal of the
Clogston decision in Rutland;
Once a home is affixed to a permanent foundation, this home is considered
real property as opposed to a mobile home. This definition is widely
supported within the Lending industry by most all Attorneys, Lenders, and
Secondary Market groups (i.e. Fannie Mae and Freddie Mac)
The VMBA's concern on this particular case is not necessarily whether the
home put upon this property violates the covenants of the development. We do
not know how the covenants read in this particular development in regards to
style, build, or make up of the homes to be included in this development.
What we are concerned of is the important distinction between real property
and a mobile home. This distinction creates a wide variance in the types of
financing available to the public. A mobile home is a much more difficult
property to provide favorable financing terms and conditions.
If a precedent is set that labels all pre-manufactured housing secured to a
foundation, as a mobile home, we have effectively opened a door for
literally thousands of homes that will no longer be eligible for preferable
secondary market financing. In so doing this creates even more barriers to
affordable housing than already exist in Vermont.
Vermont Mortgage Bankers Association