CA, 03/14 ( Business Wire )- Palm Harbor Homes, Inc. (NASDAQ: PHHM) today announced that CountryPlace Mortgage, Ltd., the Company’s full-service lending subsidiary, has negotiated an extension on its warehouse borrowing facility with its current provider until April 30, 2008. The total amount outstanding under this facility is currently $42.2 million. The facility was originally scheduled to expire on March 14, 2008. During the extension period, CountryPlace will stop taking applications for non-conforming chattel loans, but will continue to originate conforming mortgage loans.

Commenting on the announcement, Larry H. Keener, chairman and chief executive officer of Palm Harbor Homes, Inc., remarked, "We are pleased with the cooperation of our provider in extending the CountryPlace warehouse facility in spite of very difficult credit market conditions created by the sub-prime mortgage crisis. We believe this support reflects directly on the consistent performance of CountryPlace’s portfolio. CountryPlace has a solid five-year track record as a chattel and mortgage lender, originating and servicing high quality, fixed rate, fully-documented, and fully-verified chattel loans and mortgages, with average credit scores exceeding 700. Since 2002, CountryPlace has originated approximately 5,000 loans of these loans totaling $351.9 million. At the end of the third quarter of fiscal 2008, CountryPlace serviced 4,312 loans with outstanding balances of $290.5 million. Because of our careful underwriting and intense servicing, default rates and losses have been significantly lower than those experienced with manufactured home loans securitized in the late ‘90s, or than those experienced recently in the sub-prime mortgage industry. CountryPlace has historically originated approximately 20 percent of the chattel and non-conforming mortgages for homes sold by the retail division of Palm Harbor. Because of the high quality of these loans and the availability of other retail financing sources, it is not anticipated that this will affect Company retail sales.”

Keener added, “Both of our securitized loan portfolios continue to perform extremely well. Through December 31, 2007, our 2005 securitization has experienced a 2.10 percent cumulative loss, and our 2007 securitization has experienced a 0.14 percent cumulative loss. Because of the strong historical performance of the securitizations, the high quality of the assets and our significant equity position in the loans, we have received strong interest from several financing sources and are currently negotiating financing alternatives. We are confident that we will have a final commitment in the foreseeable future.”

Palm Harbor Homes is one of the nation's leading manufacturers and marketers of factory-built homes. The Company markets nationwide through vertically integrated operations, encompassing manufacturing, marketing, financing and insurance. For more information on the Company, please visit www.palmharbor.com.