Banks Are Walking Away From MHC Loans
Manufactured housing communities have always been a niche asset class for traditional banks. In 2026, that niche is getting even narrower. Regulatory pressure on commercial real estate concentrations, combined with the complexity of underwriting parks with private utilities and mixed ownership structures, has pushed many regional banks to the sidelines.
The result: MHC investors with strong deals are struggling to find bank financing, especially for acquisitions under $5 million and properties that need operational improvements. This is precisely where private lenders are stepping in.
Why Private Credit Works for MHC
Private lenders evaluate manufactured housing communities differently than banks do. Where a bank sees risk in a park with 30% vacant lots and deferred road maintenance, a private lender sees a value-add business plan with clear upside.
The key differences in how private lenders approach MHC financing include faster underwriting (days, not months), willingness to lend on as-is condition with a renovation holdback, flexible terms that match the business plan timeline, and no committee-driven bureaucracy that delays closings.
At Requity Lending, manufactured housing communities are a core focus of our bridge lending program. We understand the asset class because our investment arm, Requity Investments, actively acquires and operates MHCs.
The Numbers Behind the Shift
Private real estate credit fundraising hit $51 billion in final closes in 2025, the highest level since 2021. A meaningful share of that capital is flowing into niche commercial real estate sectors like manufactured housing, where banks have pulled back most aggressively.
Institutional investors are taking notice of the MHC sector as well. Private equity and institutional investors have committed more than $1 billion to dedicated manufactured housing fund vehicles in recent years, and government-backed financing is scaling alongside them, with Freddie Mac planning to finance $3.4 billion in manufactured housing community loans between 2025 and 2027. These capital inflows are creating more lending demand, not less.
Meanwhile, the manufactured housing industry contributes over $30 billion annually to the U.S. economy, and approximately 22 million Americans live in manufactured homes. The demand side of this market is not going away.
What MHC Bridge Loans Look Like Today
A typical private bridge loan for a manufactured housing community in 2026 carries these terms: loan-to-value of 65% to 75%, interest rates of 8.5% to 13%, terms of 12 to 24 months with extension options, and renovation holdback for infrastructure improvements.
The borrower brings 25% to 35% equity and a clear business plan. Common value-add strategies include filling vacant lots with new or used homes, converting park-owned homes to tenant-owned, implementing utility sub-metering, and addressing deferred maintenance on roads and utilities.
Tariff Impact on New Home Costs
One factor accelerating the shift to private lending: tariffs have pushed manufactured home costs up roughly 30% since 2024. For park owners looking to infill vacant lots, the higher cost of new homes means larger loan amounts and more complex financing structures. Private lenders are better equipped to handle these structures than banks, which often cap loan amounts or refuse to finance home inventory within the park.
The tariff-driven cost increase also has a secondary benefit for existing MHC owners. Higher replacement costs create a floor under property values, supporting the investment thesis for institutional capital entering the space.
What Investors Should Consider
If you are acquiring a manufactured housing community and your bank lender is dragging their feet (or has already declined), a private bridge loan can get you to closing while you stabilize the asset for permanent financing.
The key is having a realistic exit strategy. Most MHC bridge borrowers plan to refinance into agency debt (Fannie Mae or Freddie Mac) or a CMBS loan once the park reaches 85% or higher occupancy with stabilized income. Work backward from that target to set your renovation timeline and budget.
For MHC acquisition financing, reach out to Requity Lending for a same-week term sheet.