Lenders are jumping headlong into manufactured-home lending and competing fiercely for market share. But Ken Roberts, an industry veteran, is determined not to get carried away.

As head of United Funding, the new manufactured-home division of United Companies Financial, Mr. Roberts is concentrating on building a portfolio that will perform well in the long run rather than snapping up as many loans as possible right away.

One area in particular has his ire up: the current craze to make loans with just 5% down.

Lenders like Green Tree Financial Corp. - which he once headed - and Bank United of Texas began offering such loans last year, and have since churned out increasingly large portfolios.

The low down payment doesn't even cover a manufactured home's depreciation, Mr. Roberts said. "I'm not going to buy that paper." Such homes typically depreciate in value rather than appreciating like standard homes.

United Funding generated $37 million in loans in the second quarter of 1996, a number analysts describe as fair for a start-up.

"We don't have any pressure on us," Mr. Roberts added. "I don't want on my headstone, 'He put together a bad portfolio,' " Mr. Roberts said.

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