Why are Manufactured Home mortgage interest rates higher?

Manuf. home Rates are higher because how lender obtain the money to make the loan. For conventional loans Fannie & Freddie bundle up the mortgage notes into a Mortgage Backed Securities then re-sale them on the bond markets. Meaning the initial investor does not have to tie up their cash for 10-30 years. So a lender may use short term deposits to fund the loan, then re-sell the mortgage and get their cash back plus a profit.

Mobile/Manuf home lenders do not have access to this re-sale market thus needing to attract longer term investors. To do this they offer higher interest rates to the investor which are passed on to the consumer. Some of the primary sources of funding for manuf/mobile loans include Credit Unions and Insurance companies.