Consumer Loans Receivable (Tables)

12 Months Ended

Mar. 28, 2015

Loans and Leases Receivable, Nonperforming Loan and Lease, Policy [Policy Text Block]

Consumer Loans Receivable. Consumer loans receivable consists of manufactured housing loans originated by CountryPlace (securitized, held for investment, or held for sale) and construction advances on mortgages. The fair value of consumer loans receivable was calculated as of the Palm Harbor Acquisition Date, as determined by the present value of expected future cash flows, with no allowance for loan loss recorded.

Loans held for investment consist of loan contracts collateralized by the borrowers’ homes and, in some instances, related land. Construction loans in progress are stated at the aggregate amount of cumulative funded advances. Loans held for sale consist of loan contracts collateralized by single-family residential mortgages. Loans held for sale are stated at the lower of cost or market on an aggregate basis. Loans held for sale are loans that, at the time of origination, are originated with the intent to resell in the mortgage market to investors, such as Fannie Mae, with which the Company has pre-existing purchase agreements, or to sell as part of a Ginnie Mae insured pool of loans.

Prior to being acquired by the Company, on July 12, 2005 and March 22, 2007, CountryPlace completed two securitizations of factory-built housing loan receivables. These two securitizations were accounted for as financings, which use the portfolio method of accounting in accordance with FASB ASC 310, Receivables – Nonrefundable Fees and Other. The securitizations included provisions for removal of accounts, retention of certain credit loss risk by CountryPlace and other factors that preclude sale accounting of the securitizations under FASB ASC 860, Transfers and Servicing. Both securitizations were accounted for as securitized borrowings; therefore, the related consumer loans receivable and securitized financings were included in CountryPlace’s financial statements. Since the Palm Harbor Acquisition Date, the acquired consumer loans receivable and securitized financings are accounted for in a manner similar to FASB ASC 310-30, Loans and Debt Securities Acquired with Deteriorated Credit Quality ("ASC 310-30").

The Company acquired consumer loans receivable during the first quarter of fiscal year 2012 as part of the Palm Harbor transaction. Acquired consumer loans receivable held for investment were acquired at fair value and subsequently are accounted for in a manner similar to ASC 310-30. Consumer loans receivable held for sale are carried at the lower of cost or market and construction advances are carried at the amount advanced less a valuation allowance.

Consumer Loans Receivable

The following table summarizes consumer loans receivable (in thousands):



	March 28, 2015			March 29, 2014
Loans held for investment (acquired on Palm Harbor Acquisition Date)	$	77,670		$	87,596
Loans held for investment (originated after Palm Harbor Acquisition Date)	5,005			1,885
Loans held for sale	11,903			6,741
Construction advances	4,076			2,403
Consumer loans receivable	98,654			98,625
Deferred financing fees and other, net	(496		)	(341		)
Consumer loans receivable, net	$	98,158		$	98,284

Revenue Recognition, Interest [Policy Text Block]

Financial Services Revenue Recognition. Premium amounts collected on policies issued and assumed by Standard Casualty are amortized on a straight-line basis into net revenue over the life of the policy. Premiums earned are net of reinsurance ceded. Policy acquisition costs are also amortized as cost of sales over the life of the policy.

At the Palm Harbor Acquisition Date, management evaluated consumer loans receivable held for investment by CountryPlace to determine whether there was evidence of deterioration of credit quality and if it was probable that CountryPlace would be unable to collect all amounts due according to the loans’ contractual terms. The Company also considered expected prepayments and estimated the amount and timing of undiscounted expected principal, interest and other cash flows. The Company determined the excess of the loan pool’s scheduled contractual principal and contractual interest payments over the undiscounted cash flows expected as of the Palm Harbor Acquisition Date as an amount that is not accreted into interest income (the non-accretable difference). The remaining difference is accreted into interest income over the remaining life of the loans (referred to as accretable yield). Interest income on consumer loans receivable is recognized as net revenue (see Note 5).

For loans originated by CountryPlace and held for sale, loan origination fees and gains or losses on sales are recognized as net revenue upon title transfer of the loans. CountryPlace provides third-party servicing of mortgages and earns servicing fees each month based on the aggregate outstanding balances. Servicing fees are recognized as net revenue when earned.

As of the date of the Palm Harbor acquisition, management evaluated consumer loans receivable held for investment by CountryPlace to determine whether there was evidence of deterioration of credit quality and if it was probable that CountryPlace would be unable to collect all amounts due according to the loans' contractual terms. The Company also considered expected prepayments and estimated the amount and timing of undiscounted expected principal, interest and other cash flows. The Company determined the excess of the loan pool’s scheduled contractual principal and contractual interest payments over all cash flows expected as of the date of the Palm Harbor transaction as an amount that cannot be accreted into interest income (the non-accretable difference). The cash flow expected to be collected in excess of the carrying value of the acquired loans is accreted into interest income over the remaining life of the loans (referred to as accretable yield). Interest income on consumer loans receivable is recognized as net revenue.

Acquired Consumer Loans Receivable Held for Investment



	March 28, 2015			March 29, 2014
	(in thousands)
Consumer loans receivable held for investment – contractual amount	$	192,523		$	223,388
Purchase discount:
Accretable	(73,202		)	(77,737		)
Non-accretable difference	(41,305		)	(57,672		)
Less consumer loans receivable reclassified as other assets	(346		)	(383		)
Total acquired consumer loans receivable held for investment, net	$	77,670		$	87,596

Weighted average assumptions cash flows [Table Text Block]

Over the life of the acquired loans, the Company continues to estimate cash flows expected to be collected by CountryPlace. As of the balance sheet date, the Company evaluates whether the present value of expected cash flows, determined using the effective interest rate, has decreased from the value at acquisition and, if so, recognizes an allowance for loan loss. The present value of any subsequent increase in the loan pool’s actual cash flows expected to be collected is used first to reverse any existing allowance for loan loss. Any remaining increase in cash flows expected to be collected adjusts the amount of accretable yield recognized on a prospective basis over the loan pool’s remaining life. The weighted averages of assumptions used in the calculation of expected cash flows to be collected are as follows:



	March 28, 2015		March 29, 2014
Prepayment rate	12.6	%	12.0	%
Default rate	1.7	%	2.4	%

Assuming there were a 1% unfavorable variation from the expected level, for each key assumption, the expected cash flows, as of March 28, 2015, would decrease by approximately $2.4 million and $6.4 million for the expected prepayment rate and expected default rate, respectively.

Accretable Yield Movement on Acquired Consumer Loans Receivable

The changes in accretable yield on acquired consumer loans receivable held for investment were as follows (in thousands):



	Year Ended
	March 28, 2015			March 29, 2014
Balance at the beginning of the period	$	77,737		$	91,291
Additions	—			—
Accretion	(11,230		)	(11,973		)
Reclassifications from (to) nonaccretable discount	6,695			(1,581		)
Balance at the end of the period	$	73,202		$	77,737

Consumer Loans Held for Investment Characteristics [Table Text Block]

The consumer loans held for investment have the following characteristics:



	March 28, 2015		March 29, 2014
Weighted average contractual interest rate	9.10	%	9.09	%
Weighted average effective interest rate	9.27	%	9.14	%
Weighted average months to maturity	178		188

The Company's consumer loans receivable balance consists of fixed-rate, fixed-term and fully-amortizing single-family home loans. These loans are either secured by a manufactured home, excluding the land upon which the home is located (chattel property loans and retail installment sale contracts), or by a combination of the home and the land upon which the home is located (real property mortgage loans). The real property mortgage loans are primarily for manufactured homes. Combined land and home loans are further disaggregated by the type of loan documentation: those conforming to the requirements of Government-Sponsored Enterprises ("GSEs"), and those that are non-conforming. In most instances, CountryPlace’s loans are secured by a first-lien position and are provided for the consumer purchase of a home. In rare instances, CountryPlace may provide other types of loans in second-lien or unsecured positions. Accordingly, CountryPlace classifies its loans receivable as follows: chattel loans, conforming mortgages, non-conforming mortgages and other loans.

Gross Consumer Loans Receivable by Portfolio Segment and Credit Risk Score

The following table disaggregates CountryPlace’s gross consumer loans receivable as of March 28, 2015, for each class by portfolio segment and credit quality indicator as of the time of origination (in thousands):



	Consumer Loans Held for Investment
	Securitized 2005		Securitized 2007		Unsecuritized		Construction Advances		Consumer Loans Held For Sale		Total
Asset Class
Credit Quality Indicator
Chattel loans
0-619	$	937	$	594	$	385	$	—	$	58	$	1,974
620-719	14,907		10,266		3,202		—		—		28,375
720+	16,889		10,845		2,252		—		—		29,986
Other	65		—		349		—		—		414
Subtotal	32,798		21,705		6,188		—		58		60,749
Conforming mortgages
0-619	—		—		167		18		345		530
620-719	—		—		1,505		2,909		6,412		10,826
720+	—		—		10		1,149		2,501		3,660
Other	—		—		—		—		2,587		2,587
Subtotal	—		—		1,682		4,076		11,845		17,603
Non-conforming mortgages
0-619	91		674		1,571		—		—		2,336
620-719	1,467		5,736		3,952		—		—		11,155
720+	1,793		3,717		965		—		—		6,475
Other	—		—		321		—		—		321
Subtotal	3,351		10,127		6,809		—		—		20,287
Other loans
Subtotal	—		—		15		—		—		15
	$	36,149	$	31,832	$	14,694	$	4,076	$	11,903	$	98,654

Geographic Concentration of Consumer Loans Receivable

Loan contracts secured by collateral that is geographically concentrated could experience higher rates of delinquencies, default and foreclosure losses than loan contracts secured by collateral that is more geographically dispersed. Forty-one percent of the outstanding principal balance of consumer loans receivable portfolio is concentrated in Texas. Other than Texas, no other state had concentrations in excess of 10% of the principal balance of the consumer loan receivable as of March 28, 2015