0001558370-21-003153 | 10-K | XBRL Viewer

Document and Entity Information - USD ($)	12 Months Ended
Document and Entity Information - USD ($)	Dec. 31, 2020	Mar. 12, 2021	Jun. 30, 2020
Document and Entity Information
Document Type	10-K
Document Period End Date	Dec. 31, 2020
Entity Registrant Name	Legacy Housing Corp
Title of 12(b) Security	Common Stock ($0.001 par value)
Trading Symbol	LEGH
Security Exchange Name	NASDAQ
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
Entity Shell Company	false
Entity Public Float			$ 102,082,692
Entity Common Stock, Shares Outstanding		24,202,631
Entity Central Index Key	0001436208
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	FY
Amendment Flag	false

BALANCE SHEETS - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Current assets:
Cash and cash equivalents	$ 768	$ 1,724
Accounts receivable, net of allowance for doubtful accounts	3,867	1,767
Current portion of consumer loans	5,348	5,994
Current portion of notes receivable from mobile home parks (“MHP”)	12,468	10,969
Current portion of other notes receivable	2,054	428
Inventories	27,224	27,228
Prepaid expenses and other current assets	3,234	4,857
Total current assets	54,963	52,967
Property, plant and equipment, net	22,616	21,038
Consumer loans, net of deferred financing fees and allowance for loan losses	106,572	99,048
Notes receivable from mobile home parks (“MHP”)	123,872	81,375
Other notes receivable, net of allowance for loan losses	13,050	13,050
Other assets	8,887	4,212
Inventory non-current	8,656	11,930
Total assets	338,616	283,620
Current liabilities:
Accounts payable	10,197	5,168
Accrued liabilities	14,860	8,808
Customer deposits	3,620	1,567
Escrow liability	7,729	7,530
Line of credit		28,860
Total current liabilities	36,406	51,933
Long-term liabilities:
Lines of credit	36,174	2,001
Deferred income taxes	1,971	1,766
Accrued liabilities, net of current portion	630
Dealer incentive liability	4,242	5,531
Total liabilities	79,423	61,231
Commitments and contingencies (Note 13)
Stockholders' equity:
Preferred stock, $.001 par value, 10,000,000 shares authorized: issued -0-
Common stock, $.001 par value, 90,000,000 shares authorized; 24,639,125 and 24,620,079 issued and 24,194,060 and 24,320,079 outstanding at December 31, 2020 and December 31, 2019, respectively	25	25
Treasury stock at cost, 445,065 and 300,000 shares at December 31, 2020 and December 31, 2019, respectively	(4,477)	(3,060)
Additional paid-in-capital	175,293	175,067
Retained earnings	88,352	50,357
Total stockholders' equity	259,193	222,389
Total liabilities and stockholders' equity	$ 338,616	$ 283,620

BALANCE SHEETS (Parenthetical) - $ / shares	Dec. 31, 2020	Dec. 31, 2019
BALANCE SHEETS
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, shares authorized	10,000,000	10,000,000
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized	90,000,000	90,000,000
Common stock, shares issued	24,639,125	24,620,079
Common stock, shares outstanding	24,194,060	24,320,079
Treasury stock, shares	445,065	300,000

STATEMENTS OF OPERATIONS - USD ($) $ in Thousands	12 Months Ended
STATEMENTS OF OPERATIONS - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Net revenue:
Product sales	$ 148,030	$ 143,196
Consumer and MHP loans interest	25,360	22,188
Other	3,334	3,572
Total net revenue	176,724	168,956
Operating expenses:
Cost of product sales	109,723	104,903
Selling, general administrative expenses	19,068	25,482
Dealer incentive	336	731
Income from operations	47,597	37,840
Other income (expense):
Non-operating interest income	915	300
Miscellaneous, net	288	152
Gain on settlement, net	1,075
Interest expense	(1,053)	(702)
Total other	1,225	(250)
Income before income tax expense	48,822	37,590
Income tax expense	(10,827)	(8,746)
Net income	$ 37,995	$ 28,844
Weighted average shares outstanding:
Basic	24,226,128	24,379,667
Diluted	24,236,395	24,436,954
Net income per share:
Basic	$ 1.57	$ 1.18
Diluted	$ 1.57	$ 1.18

STATEMENTS OF CHANGES IN STOCKHOLDERS EQUITY - USD ($) $ in Thousands	Common Stock	Treasury stock	Additional paid-in-capital	Retained earnings	Total
Beginning Balance at Dec. 31, 2018	$ 24		$ 167,743	$ 21,513	$ 189,280
Beginning Balance (in shares) at Dec. 31, 2018	24,000,000
Sale of over-allotment common stock in initial public offering, net of offering costs	$ 1		6,694		6,695
Sale of over-allotment common stock in initial public offering, net of offering costs (in shares)	600,000
Share based compensation expense and stock units vested			630		630
Share based compensation expense and stock units vested (in shares)	20,079
Purchase of treasury stock		$ (3,060)			(3,060)
Net income				28,844	28,844
Ending Balance at Dec. 31, 2019	$ 25	(3,060)	175,067	50,357	$ 222,389
Ending Balance (in shares) at Dec. 31, 2019	24,620,079				24,620,079
Share based compensation expense and stock units vested			226		$ 226
Share based compensation expense and stock units vested (in shares)	19,046
Purchase of treasury stock		(1,417)			(1,417)
Net income				37,995	37,995
Ending Balance at Dec. 31, 2020	$ 25	$ (4,477)	$ 175,293	$ 88,352	$ 259,193
Ending Balance (in shares) at Dec. 31, 2020	24,639,125				24,639,125

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References + Details

STATEMENTS OF CHANGES IN STOCKHOLDERS EQUITY (Parenthetical) $ in Thousands	12 Months Ended
	Dec. 31, 2019 USD ($)
STATEMENTS OF CHANGES IN STOCKHOLDERS EQUITY
Net of offering costs	$ 505

STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	12 Months Ended
STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Operating activities:
Net income	$ 37,995	$ 28,844
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation expense	1,212	1,014
Provision for loan loss—consumer loans	819	769
Deferred income taxes	205	(76)
Share based payment expense	226	630
Gain on sale of land	(66)
Changes in operating assets and liabilities:
Accounts receivable	(1,716)	826
Consumer loans originations	(19,712)	(18,961)
Consumer loans principal collections	11,196	9,729
Notes receivable MHP originations	(68,522)	(60,969)
Notes receivable MHP principal collections	23,529	26,561
Inventories	3,278	10,275
Prepaid expenses and other current assets	1,918	(1,876)
Other assets	(4,874)	(1,712)
Accounts payable	5,029	2,340
Accrued liabilities	6,682	(348)
Customer deposits	2,053	(655)
Dealer incentive liability	(1,289)	(584)
Net cash used in operating activities	(2,037)	(4,193)
Investing activities:
Purchases of property, plant and equipment	(2,845)	(4,206)
Proceeds from sale of land	30
Issuance of notes receivable	(5,082)	(11,875)
Notes receivable collections	4,358	372
Purchases of consumer loans	(487)	(359)
Collections from purchased consumer loans	1,308	955
Net cash used in investing activities	(2,718)	(15,113)
Financing activities:
Proceeds from sale of over-allotment common stock in initial public offering		7,200
Offering cost for over-allotment of initial public offering		(505)
Treasury stock purchase	(1,417)	(3,060)
Proceeds from issuance of note payable	6,546
Principal payments on note payable	(6,546)	(3,965)
Escrow liability, net	199	1,579
Proceeds from lines of credit, net	67,698	65,686
Payments on lines of credit	(62,681)	(48,504)
Net cash provided by financing activities	3,799	18,431
Net decrease in cash and cash equivalents	(956)	(875)
Cash and cash equivalents at beginning of year	1,724	2,599
Cash and cash equivalents at end of year	768	1,724
Supplemental disclosure of cash flow information:
Cash paid for interest	985	722
Cash paid for taxes	6,728	9,306
Supplemental disclosure of non-cash transactions:
Note receivable received in exchange of asset	$ 290
Asset received in exchange of accounts receivable		422
Asset received in exchange of note receivable		$ 254

NATURE OF OPERATIONS	12 Months Ended
NATURE OF OPERATIONS	Dec. 31, 2020
NATURE OF OPERATIONS
NATURE OF OPERATIONS	1. NATURE OF OPERATIONS Legacy Housing Corporation (the “Company”) was formed on January 1, 2018 as a Delaware corporation through a corporate conversion of Legacy Housing, Ltd., (the “Partnership”) a Texas limited partnership formed in May 2005. Effective December 31, 2019, the Company reincorporated from a Delaware corporation to a Texas corporation. The Company is headquartered in Bedford, Texas. The Company (1) manufactures and provides for the transport of mobile homes, (2) provides wholesale financing to dealers and mobile home parks and (3) provides retail financing to consumers and (4) is involved in financing and developing new manufactured home communities. The Company manufactures its mobile homes at plants located in Fort Worth, Texas, Commerce, Texas and Eatonton, Georgia. The Company relies on a network of dealers to market and sell its mobile homes. The Company also sells homes directly to dealers and mobile home parks. In December 2018, the Company sold 4,000,000 shares of its common stock through an initial public offering (“IPO”) at $12.00 per share. Proceeds from the IPO, net of $4,504 of underwriting discounts and offering expenses paid by the Company, were $43,492. In January 2019, the Company sold an additional 600,000 shares of its common stock as part of the IPO at $12.00 per share. Proceeds from the January 2019 issuance, net of $505 of underwriting discounts and offering expenses paid by the Company, were $6,695. On April 17, 2019, the Company purchased 300,000 shares of its common stock at the price of $10.20 per share, pursuant to the Company’s repurchase program. During the year ended December 31, 2020, the Company purchased 145,065 shares of its common stock at an average price of $9.77 per share, pursuant to the Company’s repurchase program. Under the repurchase program, the Company may purchase up to $10,000 of its common stock. Share purchases may be made from time to time in the open market or through privately negotiated transactions depending on market conditions, share price, trading volume and other factors. Such purchases, if any, will be made in accordance with applicable insider trading and other securities laws and regulations. These repurchases may be commenced or suspended at any time or from time to time without prior notice. Corporate Conversion Effective January 1, 2018, the Partnership converted into a Delaware corporation pursuant to a statutory conversion and changed its name to Legacy Housing Corporation. In order to consummate the corporate conversion completed on January 1, 2018, a certificate of conversion was filed with the Secretary of State of the State of Delaware and with the Secretary of State of the State of Texas. Holders of partnership interests in Legacy Housing, Ltd. received an initial allocation, on a proportional basis, of 20,000,000 shares of common stock of Legacy Housing Corporation. Following the corporate conversion, Legacy Housing Corporation continues to hold all property and assets of Legacy Housing, Ltd. and all of the debts and obligations of Legacy Housing, Ltd. On the effective date of the corporate conversion, the officers of Legacy Housing, Ltd. became the officers of Legacy Housing Corporation. As a result of the corporate conversion, The Company is now a federal corporate taxpayer. Basis of Presentation The financial statements of the Company have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Use of Estimates The preparation of our financial statements in conformity with GAAP requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of income and expenses during the reporting period. Material estimates that are susceptible to significant change in the near term primarily relate to the determination of accounts receivable, loans to mobile home parks, consumer loans and notes receivable, inventory obsolescence, income taxes, fair value of financial instruments and contingent liabilities. Actual results could differ from these estimates. Segment Reporting The Company has one reportable segment. All of the Company’s activities are interrelated, and each activity is dependent and assessed based on how each of the activities of the Company supports the others. For example, the sale of manufactured homes is done through wholesale and retail operations that include providing transportation and consignment arrangements with dealers. The Company also provides financing options to the customers to facilitate such sale of homes. In addition, the sale of homes is directly related to financing provided by the Company. Accordingly, all significant operating and strategic decisions by the chief operating decision‑maker, the Executive Chairman of the Board, are based upon analyses of the Company as one segment or unit.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

12 Months Ended

Dec. 31, 2020

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Cash and Cash Equivalents

The Company considers all cash and highly liquid investments with an original maturity of three months or less to be cash equivalents. The Company maintains cash balances in bank accounts that may, at times, exceed federally insured limits. The Company has not incurred any losses from such accounts and management considers the risk of loss to be minimal. As of December 31, 2020, the Company had one bank account that exceeded the FDIC limit by an aggregate amount of $518.

Accounts Receivable

Included in accounts receivable are receivables from direct sales of mobile homes and sales of parts and supplies to customers, consignment fees and interest receivables.

Accounts receivables are generally due within 30 days and are stated at amounts due from customers net of an allowance for doubtful accounts. Accounts outstanding longer than the contractual payment terms are considered past due. The Company determines the allowance by considering several factors, including the aging of the past due balance, the customer’s payment history, and the Company’s previous loss history. The Company establishes an allowance for doubtful accounts for amounts that are deemed to be uncollectible. At December 31, 2020 and 2019, the allowance for doubtful accounts totaled $97 and $457, respectively.

Consumer Loans Receivable

Consumer loans receivable result from financing transactions entered into with retail consumers of mobile homes sold through independent retailers and company-owned retail locations. Consumer loans receivable generally consist of the sales price and any additional financing fees, less the buyer’s down payment. Interest income is recognized monthly per the terms of the financing agreements. The average contractual interest rate per loan was approximately 13.8% as of December 31, 2020 and 14.0% as of December 31, 2019. Consumer loans receivable have maturities that range from 2 to 30 years.

Loan applications go through an underwriting process which considers credit history to evaluate credit risk of the consumer. Interest rates on approved loans are determined based on consumer credit score, payment ability and down payment amount.

The Company uses payment history to monitor the credit quality of the consumer loans on an ongoing basis.

The Company may also receive escrow payments for property taxes and insurance included in its consumer loan collections. The liabilities associated with these escrow collections totaled $7,729 and $7,530 as of December 31, 2020 and 2019, respectively, and are included in escrow liability in the balance sheets.

Allowance for Loan Losses—Consumer Loans Receivable

The allowance for loan losses reflects management’s estimate of losses inherent in the consumer loans that may be uncollectible based upon review and evaluation of the consumer loan portfolio as of the date of the balance sheet. An allowance for loan losses is determined after giving consideration to, among other things, the loan characteristics, including the financial condition of borrowers, the value and liquidity of collateral, delinquency and historical loss experience.

The allowance for loan losses is comprised of two components: the general reserve and specific reserves. The Company’s calculation of the general reserve considers the historical loss rate for the last three years, adjusted for the estimated loss discovery period and any qualitative factors both internal and external to the Company. Specific reserves are determined based on probable losses on specific classified impaired loans.

The Company’s policy is to place a loan on nonaccrual status when there is a clear indication that the borrower’s cash flow may not be sufficient to meet payments as they become due, which is normally when either principal or interest is past due and remains unpaid for more than 90 days. Management implemented this policy based on an analysis of historical data, current performance of loans and the likelihood of recovery once principal or interest payments became delinquent and were aged more than 90 days. Payments received on nonaccrual loans are accounted for on a cash basis, first to interest and then to principal, as long as the remaining book balance of the asset is deemed to be collectible. The accrual of interest resumes when the past due principal or interest payments are brought within 90 days of being current. As of December 31, 2020 and 2019, total principal outstanding for consumer loans on nonaccrual status was $1,603 and $1,677, respectively.

Impaired loans are those loans where it is probable the Company will be unable to collect all amounts due in accordance with the original contractual terms of the loan agreement, including scheduled principal and interest payments. Impaired loans, or portions thereof, are charged off when deemed uncollectible. A loan is generally deemed impaired if it is more than 90 days past due on principal or interest, is in bankruptcy proceedings, or is in the process of repossession. A specific reserve is created for impaired loans based on fair value of underlying collateral value, less estimated selling costs. The Company used various factors to determine the value of the underlying collateral for impaired loans. These factors were: (1) the length of time the unit was unsold after construction; (2) the amount of time the house was occupied; (3) the cooperation level of the borrowers, i.e., loans requiring legal action or extensive field collection efforts; (4) units located on private property as opposed to a manufactured home park; (5) the length of time the borrower has lived in the house without making payments; (6) location, size, and market conditions; and (7) the experience and expertise of the particular dealer assisting in collection efforts.

Collateral for repossessed loans is acquired through foreclosure or similar proceedings and is recorded at the estimated fair value of the home, less the costs to sell. At repossession, the fair value of the collateral is computed based on the historical recovery rates of previously charged‑off loans; the loan is charged off and the loss is charged to the allowance for loan losses. At each reporting period, the fair value of the collateral is adjusted to the lower of the amount recorded at repossession or the estimated sales price less estimated costs to sell, based on current information. Repossessed homes totaled $1,395 and $1,846 as of December 31, 2020 and 2019, respectively, and are included in other assets in the balance sheets.

Notes Receivable from Mobile Home Parks

The notes receivable from mobile home parks (“MHP Notes” or “Notes”) relate to mobile homes sold to mobile home parks and financed through notes receivable. The Notes have varying maturity dates and call for monthly principal and interest payments. The interest rate on the MHP Notes can be fixed or variable. Approximately $109 million of the Notes have a fixed interest rate ranging from 5.0% to 9.5%. The remaining Notes have a variable rate typically set at 4.0% above prime with a minimum of 8.0%. The average interest rate per loan was approximately 7.7% and 8.7% as of December 31, 2020 and 2019, respectively with maturities that range from 1 to 20 years. The collateral underlying the Notes are individual mobile homes which can be repossessed and resold. The MHP Notes are generally personally guaranteed by the borrowers with substantial financial resources.

The Company had concentrations of MHP Notes with an independent third-party and its affiliates that equaled 52.9% and 38.3% of the principal balance outstanding, all of which was secured by the mobile homes, as of December 31, 2020 and 2019, respectively.

Allowance for Loan Losses—MHP Notes

MHP Notes are stated at amounts due from customers, net of allowance for loan losses. The Company determines the allowance by considering several factors including the aging of the past due balance, the customer’s payment history, and the Company’s previous loss history. The Company establishes an allowance reserve composed of specific and general reserve amounts. There were minimal past due balances on the MHP Notes as December 31, 2020 and 2019 and no charge offs were recorded for MHP Notes for the years ended December 31, 2020 and 2019, respectively. Allowance for loan loss is considered immaterial and accordingly no provision is recorded against the MHP Notes as of December 31, 2020 and 2019.

Other Notes Receivable

Other notes receivable relate to various notes issued to mobile home park owners and dealers, which are not directly tied to sale of mobile homes. The other notes have varying maturity dates and call for monthly principal and interest payments. The other notes are collateralized by mortgages on real estate, units being financed and used as offices, as well as vehicles, and are typically personally guaranteed by the borrowers. The interest rate on the other notes are fixed and range from 6.25% to 12.00%. The Company reserves for estimated losses on the other notes based on current economic conditions that may affect the borrower’s ability to pay, the borrower’s financial strength, and historical loss experience. As of December 31, 2020 and 2019, the allowance for loan losses on other notes was $75 and $74, respectively.

Inventories

Inventories consist of raw materials, work‑in‑process, and finished goods and are stated at the lower of cost or net realizable value. The cost of raw materials is based on the first‑in first‑out method. Finished goods and work‑in‑process are based on a standard cost system that approximates actual costs using the specific identification method.

Estimates of the lower of cost and net realizable value of inventory are determined by comparing the actual cost of the product to the estimated selling prices in the ordinary course of business based on current market and economic conditions, less reasonably predictable costs of completion, disposal, and transportation of the inventory. For the periods ending, December 31, 2020 and 2019, the Company recorded an insignificant amount of inventory write‑down.

The Company evaluates inventory based on historical experience to estimate its inventory not expected to be sold in less than a year. The Company classifies its inventory not expected to be sold in one year as non‑current. As of December 31, 2020 and 2019, non‑current inventory was $8,656 and $11,930, respectively.

Property, Plant, and Equipment

Property, plant and equipment are carried at cost less accumulated depreciation. Depreciation expense is calculated using the straight‑line method over the estimated useful lives of each asset. Estimated useful lives for significant classes of assets are as follows: buildings and improvements, 30 to 39 years; vehicles, 5 years; machinery and equipment, 7 years; and furniture and fixtures, 7 years. Repair and maintenance charges are expensed as incurred. Expenditures for major renewals or betterments which extend the useful lives of existing property, plant and equipment are capitalized and depreciated.

Impairment of Long‑Lived Assets

The Company reviews long‑lived assets for impairment whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. Assets are grouped at the lowest level in which there are identifiable cash flows that are largely independent of the cash flows of other groups of assets. In such cases, if the future undiscounted cash flows of the underlying assets are less than the carrying amount, then the carrying amount of the long‑lived asset will be adjusted for impairment to a level commensurate with a discounted cash flow analysis of the underlying asset or its determinable fair value. No impairment for long‑lived assets was recorded for the years ended December 31, 2020 and 2019.

Dealer Incentive Liability

Under a dealer agreement with qualifying independent retailers, a portfolio is created for houses sold by the independent retailer with consumer loan arrangements financed by the Company. The independent retailer is eligible to a receive dealer incentive, which is a portion of total collections expected on a consumer loan portfolio after the Company’s contribution (collection thresholds set per the terms of dealer agreement which includes Legacy’s initial contribution, plus an allocation of interest and other agreed upon periodic fees) is met.

A dealer incentive liability is recorded in the Company’s balance sheet based on total outstanding balance of individual dealer loan portfolios at period end, less the remaining portion of the Company’s contribution in respective portfolios. As of December 31, 2020 and 2019, the dealer incentive liability was $4,242 and $5,531, respectively. Dealer incentive expense for the years ended December 31, 2020 and 2019 totaled $336 and $731, respectively, and is included in the Company’s statements of operations.

Product Warranties

The Company provides retail home buyers with a one‑year warranty from the date of purchase on manufactured inventory. Product warranty costs are accrued when the covered homes are sold to customers. Product warranty expense is recognized based on the terms of the product warranty and the related estimated costs. Factors used to determine the warranty liability include the number of homes under warranty and the historical costs incurred in servicing the warranties. The accrued warranty liability is reduced as costs are incurred and warranty liability balance is included as part of accrued liabilities in the Company’s balance sheet.

A tabular presentation of the activity within the warranty liability account for the years ended December 31, 2020 and 2019 is presented below:


	2020		2019
Warranty liability, beginning of period	$	3,078	$	3,027
Product warranty accrued		1,834		3,593
Warranty costs incurred		(2,318)		(3,542)
Warranty liability, end of period	$	2,594	$	3,078

Advertising Costs

The Company expenses all advertising and marketing expenses in the period incurred. Advertising costs for the years ended December 31, 2020 and 2019 were $1,193 and $1,139, respectively.

Fair Value Measurements

The Company accounts for its investments and derivative instruments in accordance with ASC 820‑10, Fair Value Measurement, which among other things provides the framework for measuring fair value. That framework provides a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level I measurement) and the lowest priority to unobservable inputs (Level III measurements). The three levels of fair value hierarchy under ASC 820‑10, Fair Value Measurement, are as follows:


Level I	Quoted prices are available in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date.
Level II	Significant observable inputs other than quoted prices in active markets for which inputs to the valuation methodology include: (1) Quoted prices for similar assets or liabilities in active markets; (2) Quoted prices for identical or similar assets or liabilities in inactive markets; (3) Inputs other than quoted prices that are observable; (4) Inputs that are derived principally from or corroborated by observable market data by correlation or other means. If the asset or liability has a specified (contractual) term, the Level II input must be observable for substantially the full term of the asset or liability.
Level III	Significant unobservable inputs that reflect an entity’s own assumptions that market participants would use in pricing the assets or liabilities.

The asset or liability fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement.

The Company has used derivatives to manage risks related to interest rate movements. The Company does not enter into derivative contracts for speculative purposes. Interest rate swap contracts are recognized as assets or liabilities on the balance sheets and are measured at fair value. The fair value was calculated and provided by the lender, a Level II valuation technique. Management reviewed the fair values for the instruments as provided by the lender and determined the related asset and liability to be an accurate estimate of future gains and losses to the Company. The fair value of the interest rate swap was valued as an $3 asset as of December 31, 2019. This interest rate swap agreement matured on May 11, 2020.

Fair Value of Financial Instruments

The Company’s financial instruments consist primarily of cash and cash equivalents, accounts receivable, consumer loans, MHP Notes, other notes, accounts payable, lines of credit, notes payable, and dealer portion of consumer loans.

The carrying amounts of cash and cash equivalents, accounts receivable, and accounts payable approximate their respective fair values because of the short‑term maturities or expected settlement dates of these instruments. This is considered a Level I valuation technique. The lines of credit, notes payable and part of the MHP Notes have variable interest rates that reflect market rates and their fair value approximates their carrying value. This is considered a Level II valuation technique. The Company also assessed the fair value of the consumer loans receivable, the fixed rate MHP Notes and the other notes based on the discounted value of the remaining principal and interest cash flows. The Company determined that the fair value of the consumer loan portfolio was approximately $115,000 compared to the book value of $111,742 as of December 31, 2020, and a fair value of approximately $101,000 compared to the book value of $105,042 as of December 31, 2019. The Company determined that the fair value of the fixed rate MHP Notes was approximately $108,000 compared to the book value of $109,806 as of December 31, 2020, and a fair value of approximately $85,000 compared to the book value of $86,881 as of December 31, 2019. The Company determined that the fair value of the other notes was approximately $15,000 compared to the book value of $15,104 as of December 31, 2020, and a fair value of approximately $14,000 compared to the book value of $13,478 as of December 31, 2019. This is a Level III valuation technique.

Revenue Recognition

In May 2014, the FASB issued ASU 2014‑09, Revenue from Contracts with Customers (Topic 606), which outlines a comprehensive five‑step model for entities to use in accounting for revenue arising from contracts with customers and supersedes most previous revenue recognition guidance, including industry‑specific guidance. The standard requires entities to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The new guidance also includes a cohesive set of disclosure requirements intended to provide users of financial statements with comprehensive information about the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. The Company adopted the requirements of the new revenue standard on January 1, 2019 using the modified retrospective transition method, applied to contracts that were not completed as of the date of initial application, which did not have a material impact on the financial statements.

The new guidance under ASU 2014-09 is applicable to our product sales which includes sales of homes through various sales channels, and other revenue which includes consignment fees, service fees and miscellaneous income. Income generated from interest, other lending activities, and investment income are excluded from ASU 2014-09 and will continue to be accounted for under existing guidance.

For those revenue streams that are subject to ASU 2014-09, the Company evaluated the impact of adopting the new standard on our revenue recognition policies under existing guidance and determined there is no impact. The adoption did not have a significant impact on the consolidated operating results, financial position or cash flows of the Company. The Company’s evaluation of ASU 2014-09 impact on primary revenue streams are as follows:

Product sales, primarily consist of sales of mobile homes to consumers and mobile home parks through various sales channels, which include Direct Sales, Commercial Sales, Consignment Sales, and Retail Store Sales. Direct Sales include homes sold directly to independent retailers or customers that are not financed by the Company and are not sold under a consignment arrangement. These types of homes are generally paid for prior to shipment. Commercial Sales include homes sold to mobile home parks under commercial loan programs or paid for upfront. The Company provides floor plan financing for independent retailers, which takes the form of a consignment arrangement. Consignment Sales are considered sales of consigned homes from independent dealers to individual customers. Retail Store Sales are homes sold through Company-owned retail locations. Consignment Sales and Retail Sales of homes may be financed by the Company, by a third party, or in paid in cash.

Revenue from product sales is recognized at a point in time when the performance obligation under the terms of a contract with our customers is satisfied which typically occurs upon delivery and transfer of title of the home, as this depicts when control of the promised good is transferred to our customers. For financed sales by the Company, the individual customer enters into a sales and financing contract and is required to make a down payment. These financed sales contain a significant financing component and any interest income is separately recorded in the statement of operations.

Revenue is measured as the amount of consideration expected to be received in exchange for transferring the homes to the customers. Sales and other similar taxes collected concurrently with revenue-producing activities are excluded from revenue.

The Company made an accounting policy election to account for any shipping and handling costs that occur after the transfer of control as a fulfillment cost that is accrued when control is transferred. Warranty obligations associated with the sale of a unit are assurance-type warranties for a period of twelve months that are a guarantee of the home’s intended functionality and, therefore, do not represent a distinct performance obligation within the context of the contract. The Company has elected to use the practical expedient to expense the incremental costs of obtaining a contract if the amortization period of the asset that the Company would have otherwise recognized is one year or less. Contract costs, which include commissions incurred related to the sale of homes, are expensed at the point-in-time when the related revenue is recognized.

For the years ended December 31, 2020 and 2019, sales to an independent third-party and its affiliates accounted for $41,263 or 28.7% and $38,439 or 26.8% of our product sales, respectively.

For the years ended December 31, 2020 and 2019, total cost of product sales included $24,165 and $23,760 of costs, mainly relating to up front dealer commission and reimbursed dealer expenses for consignment sales and certain other similar costs incurred for retail store and commercial sales.

Other revenue consists of consignment fees, service fees and other miscellaneous income. Consignment fees are charged to independent retailers on a monthly basis for homes held by the independent retailers pursuant to a consignment arrangement until the home is sold to an individual customer. Consignment fees are determined as a percentage of the home’s wholesale price to the independent dealer. Revenue recognition for consignment fees are recognized over time using the output method as it provides a faithful depiction of the Company’s performance toward completion of the performance obligation under the contract and the value transferred to the independent retailer for the time the home is held under consignment. Revenue for service fees and miscellaneous income is recognized at a point in time when the performance obligation is satisfied.

Disaggregation of Revenue. The following table summarizes customer contract revenues disaggregated by source of the revenue for the years ended December 31, 2020 and 2019:


	Year ended
	December 31,
	2020		2019
Product sales:
Direct sales	$	11,731	$	15,186
Commercial sales		70,186		64,358
Consignment sales		43,801		42,934
Retail store sales		17,436		16,114
Other (1)		4,876		4,604
Total product sales		148,030		143,196
Consumer and MHP loans interest:
Interest - consumer installment notes		15,979		15,908
Interest - MHP notes		9,381		6,280
Total consumer and MHP loans interest		25,360		22,188
Other		3,334		3,572
Total net revenue	$	176,724	$	168,956

(1)

Other product sales revenue from ancillary products and services including parts, freight and other services

Reserve for Repurchase Commitments

In accordance with customary business practice in the manufactured housing industry, the Company has entered into certain repurchase agreements with certain financial institutions and other credit sources who provide floor plan financing to industry retailers, which provided that the Company will be obligated, under certain circumstances, to repurchase homes sold to retailers in the event of a default by a retailer in its obligation to such credit sources. The Company’s obligation under these repurchase agreements ceases upon the purchase of the home by the retail customer. The Company applies ASC 460, Guarantees and ASC 450‑20, Loss Contingencies, to account for its liability for repurchase commitments. The Company considers its current obligations on current contracts to be immaterial and accordingly have not recorded any reserve for repurchase commitments as of December 31, 2020 and 2019.

Other Income, Net

Other income primarily consists of interest related to commercial loan receivable balances and interest income earned on cash balances, reduced by interest expenses.

Interest Income

Interest on consumer loans, MHP Notes and other notes is recognized using the effective‑interest method on the daily balances of the principal amounts outstanding and recorded as part of total revenue. Fees associated with the origination of loans and certain direct loan origination costs are netted and the net amount is deferred and recognized over the life of the loan as an adjustment of yield.

Share-Based Compensation

The Company accounts for share-based compensation in accordance with the provisions of ASC 718, Compensation—Stock Compensation. Share-based compensation expense is recognized based on the award’s estimated grant date fair value in order to recognize compensation cost for those shares expected to vest. The Company has elected to record forfeitures as they occur. Compensation cost is recognized on a straight-line basis over the vesting period of the awards and adjusted as forfeitures occur.

The fair value of each option grant with only service-based conditions is estimated using the Black-Scholes pricing model. The fair value of each restricted stock unit (the ”RSU”) is calculated based on the closing price of the Company’s common stock on the grant date.

The fair value of stock option awards on the date of grant is estimated using the Black-Scholes option pricing model, which requires the Company to make certain predictive assumptions. The risk-free interest rate is based on the implied yield of U.S. Treasury zero-coupon securities that correspond to the expected life of the award. As a recently formed public entity with a small public float and limited trading of its common shares on the NASDAQ Global Market, it was not practicable for the Company to estimate the volatility of its common shares; therefore, management estimated volatility based on the historical volatilities of a small group of companies considered as close to comparable to the Company as available, all equally weighted, over the expected life of the option. Management concluded that this group is more characteristic of the Company’s business than a broad industry index. The expected life of awards granted represents the period of time that the awards are expected to be outstanding based on the “simplified” method, which is allowed for companies that cannot reasonably estimate the expected life of options based on its historical award exercise experience. The Company does not expect to pay dividends on its common stock.

Shipping and Handling Costs

Shipping and handling costs incurred to deliver product to our customers are included as a component of cost of product sales in the statement of operations. Shipping and handling costs for the years ended December 31, 2020 and 2019 were $706 and $525, respectively.

Income Taxes

The Company is subject to U.S. federal and state income taxes as a corporation. Prior to the corporate conversion, the Partnership was treated as a flow‑through entity for U.S. federal income tax purposes, and as such, was generally not subject to U.S. federal income tax at the entity level. Rather, the tax liability with respect to its taxable income was passed through to its partners. Accordingly, prior to the corporate conversion, the Partnership only recorded a provision for Texas franchise tax as the Partnership’s taxable income was included in the income tax returns of the individual partners.

Income tax expense for the Company is recognized for the tax effects of the transactions reported in the financial statements and consist of taxes currently due, plus deferred taxes. The deferred tax assets and liabilities represent the future tax return consequences of those differences, which will be either taxable or deductible when the assets and liabilities are recovered or settled. Deferred tax assets and liabilities are reflected at income tax rates applicable to the period in which the deferred tax assets or liabilities are expected to be realized or settled. As changes in tax laws or rates are enacted, deferred tax assets and liabilities are adjusted through the provision for income taxes.

A valuation allowance, if needed, reduces deferred tax assets to the expected amount most likely to be realized. Realization of deferred tax assets is dependent upon the generation of a sufficient level of future taxable income and recoverable taxes paid in prior years. Although realization is not assured, management believes it is more likely than not that the deferred tax assets will be realized. In addition, management does not believe there are any unrecorded deferred tax liabilities that are material to the financial statements.

In December 2017, a comprehensive U.S. tax reform package, the Tax Cuts and Jobs Act, or Tax Act, was enacted which, among other things, lowered the corporate income tax rate from 35% to 21%. As a result of the corporate conversion on January 1, 2018, the Company measured its opening deferred tax assets and liabilities at the newly enacted rate.

The determination of the provision for income taxes requires significant judgment, use of estimates, and the interpretation and application of complex tax laws. Significant judgment is required in assessing the timing and amounts of deductible and taxable items and the probability of sustaining uncertain tax positions. The benefits of uncertain tax positions are recorded in the Company’s financial statements only after determining a more‑likely‑than‑not probability that the uncertain tax positions will withstand challenge, if any, from taxing authorities. When facts and circumstances change, the Company reassesses these probabilities and records any changes through the provision for income taxes. The Company recognizes interest and penalties relating to uncertain tax provisions as a component of tax expense. For the periods presented, management has determined there are no material uncertain tax positions which was performed for the tax years that remain subject to examination by major tax jurisdictions as of December 31, 2020, which includes the tax years 2018 and 2019.

Concentrations

Financial instruments that potentially subject the Company to concentrations of credit risk are accounts receivable, consumer loans, MHP Notes and other notes receivable. Management believes that its credit policies are adequate to minimize potential credit risk related to accounts receivable and other notes receivable. The consumer loans are secured by the mobile homes that were financed through the loans. The MHP Notes are secured by mobile homes, other assets, and are personally guaranteed. The MHP Notes personal guarantor may cover multiple parks and each park is treated as a customer. As of December 31, 2020 and 2019, the Company had concentrations of MHP Notes with an independent third-party and its affiliates that equaled 52.9% and 38.3%, respectively of the principal balance outstanding, all of which was secured.

Recent Accounting Pronouncements

The Company has elected to use longer phase‑in periods for the adoption of new or revised financial accounting standards under the JOBS Act as an emerging growth company.

In February 2016, the FASB issued ASU 2016‑02, Leases (Topic 842), to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. A lessee should recognize in the balance sheet a liability to make lease payments (the lease liability) and an asset representing its right to use the underlying asset for the lease term. The recognition, measurement and presentation of expenses and cash flows arising from a lease by a lessee have not significantly changed from previous requirements. The Company plans to use longer phase‑in period for adoption and accordingly this ASU is effective for the Company’s fiscal year beginning January 1, 2022. Modified retrospective application and early adoption is permitted. The Company expects that the adoption of this standard will result in a material increase to assets and liabilities on the balance sheet but will not have a material impact on the statement of operations. While the Company is continuing to assess all the effects of adoption, it currently believes the most significant effects relate to (i) the recognition of new right-of-use assets and lease liabilities on its balance sheet for its property and equipment operating leases and (ii) providing significant new disclosures about its leasing activities.

In June 2016, the FASB issued an accounting standards update ASU 2016‑13 Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which amends guidance on reporting credit losses for assets held at amortized cost basis and available for sale debt securities. For assets held at amortized cost basis, Topic 326 eliminates the probable initial recognition threshold in current GAAP and, instead, requires an entity to reflect its current estimate of all expected credit losses. The allowance for credit losses is a valuation account that is deducted from the amortized cost basis of the financial assets to present the net amount expected to be collected. For available for sale debt securities, credit losses should be measured in a manner similar to current GAAP, however Topic 326 will require that credit losses be presented as an allowance rather than as a write‑down and affects entities holding financial assets and net investment in leases that are not accounted for at fair value through net income. The amendments affect loans, debt securities, trade receivables, net investments in leases, off balance sheet credit exposures, reinsurance receivables, and any other financial assets not excluded from the scope that have the contractual right to receive cash. The Company plans to use longer phase‑in period for adoption and accordingly this ASU is effective for the Company’s fiscal year beginning January 1, 2023. The Company is continuing to evaluate the impact of the adoption of this ASU and is uncertain of the impact on the financial statements and disclosures at this point in time.

From time to time, new accounting pronouncements are issued by the FASB and other regulatory bodies that are adopted by the Company as of the specified effective dates. Unless otherwise discussed, management believes that the impact of recently issued standards, which are not yet effective, will not have a material impact on the Company’s Financial Statements upon adoption.

CONSUMER LOANS RECEIVABLE

12 Months Ended

Dec. 31, 2020

CONSUMER LOANS RECEIVABLE

CONSUMER LOANS RECEIVABLE

3. CONSUMER LOANS RECEIVABLE

Consumer loans receivable, net of allowance for loan losses and deferred financing fees, consisted of the following at December 31, 2020 and 2019:


	2020		2019
Consumer loans receivable	$	115,639	$	109,005
Loan discount and deferred financing fees, net		(2,814)		(3,050)
Allowance for loan losses		(905)		(913)
Consumer loans receivable, net	$	111,920	$	105,042

The following table presents a detail of the activity in the allowance for loan losses for the years ended December 31, 2020 and 2019:


	2020		2019
Allowance for loan losses, beginning of period	$	913	$	712
Provision for loan losses		819		769
Charge offs		(827)		(568)
Allowance for loan losses	$	905	$	913

The impaired and general reserve for allowance for loan losses at December 31, 2020 and 2019:


	2020		2019
Total consumer loans	$	115,639	$	109,005
Total allowance for loan losses		905		913
Impaired loans individually evaluated for impairment		1,603		1,677
Specific reserve against impaired loans		558		529
Other loans collectively evaluated for allowance		114,036		107,328
General allowance for loan losses		347		384

A detailed aging of consumer loans receivable that are past due as of December 31, 2020 were as follows:


	2020		%	2019		%
Total consumer loans receivable	$	115,639	100.0	$	109,005	100.0
Past due consumer loans:
31 - 60 days past due	$	954	0.8	$	267	0.2
61 - 90 days past due		221	0.2		122	0.1
91 - 120 days past due		141	0.1		103	0.1
Greater than 120 days past due		1,261	1.1		1,065	1.0
Total past due	$	2,577	2.2	$	1,557	1.4

NOTES RECEIVABLE FROM MOBILE HOME PARKS (MHP Notes)	12 Months Ended
NOTES RECEIVABLE FROM MOBILE HOME PARKS (MHP Notes)	Dec. 31, 2020
NOTES RECEIVABLE FROM MOBILE HOME PARKS (“MHP Notes”)
NOTES RECEIVABLE FROM MOBILE HOME PARKS (“MHP Notes”)	4. NOTES RECEIVABLE FROM MOBILE HOME PARKS (“MHP Notes”) MHP Notes are stated at amounts due from customers, net of allowance for loan losses. The Company determines the allowance by considering several factors including the aging of the past due balance, the customer’s payment history, and the Company’s previous loss history. The Company establishes an allowance reserve composed of specific and general reserve amounts. As of December 31, 2020 and 2019, the MHP Note balance is presented net of unamortized finance fees of $0.2 million and $0, respectively. The finance fees are amortized over the life of the Notes. The Company had concentrations of MHP Notes with an independent third-party and its affiliates that equaled 52.9% and 38.3% of the principal balance outstanding, all of which was secured, as of December 31, 2020 and 2019, respectively. There were minimal past due balances on the MHP Notes as of December 31, 2020 and 2019, respectively, and no charge offs were recorded for MHP Notes during the for the years ended December 31, 2020 and 2019, respectively. Allowance for loan loss is considered immaterial and accordingly no loss is recorded against the MHP Notes as of December 31, 2020 and 2019.

OTHER NOTES RECEIVABLE

12 Months Ended

Dec. 31, 2020

OTHER NOTES RECEIVABLE

OTHER NOTES RECEIVABLE

5. Other Notes Receivable

The balances outstanding on the other notes receivable were as follows as of December 31, 2020 and 2019:


	2020		2019
Outstanding principal balance	$	15,179	$	13,552
Allowance for loan losses		(75)		(74)
Total	$	15,104	$	13,478

INVENTORIES

12 Months Ended

Dec. 31, 2020

INVENTORIES

INVENTORIES

6. INVENTORIES

Inventories consisted of the following at December 31, 2020 and 2019:


	2020		2019
Raw materials	$	12,713	$	9,434
Work in progress		412		383
Finished goods		22,755		29,341
Total	$	35,880	$	39,158

PROPERTY, PLANT AND EQUIPMENT

12 Months Ended

Dec. 31, 2020

PROPERTY, PLANT AND EQUIPMENT

PROPERTY, PLANT AND EQUIPMENT

7. PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment consisted of the following at December 31, 2020 and 2019:


	2020		2019
Land	$	12,968	$	11,659
Buildings and leasehold improvements		10,700		10,059
Vehicles		1,664		1,580
Machinery and equipment		4,127		3,653
Furniture and fixtures		298		214
Total		29,757		27,165
Less accumulated depreciation		(7,141)		(6,127)
Total property, plant and equipment	$	22,616	$	21,038

Depreciation expense was $1,013 with $409 included as a component of cost of product sales for the year ended December 31, 2020 and $929 with $370 included as a component of cost of product sales for the year ended December 31, 2019.

OTHER ASSETS

12 Months Ended

Dec. 31, 2020

OTHER ASSETS

OTHER ASSETS

8. OTHER ASSETS

Other assets consisted of the following at December 31, 2020 and 2019:


	2020		2019
Leased property	$	7,218	$	2,067
Prepaid rent		274		299
Repossessed homes		1,395		1,846
Total	$	8,887	$	4,212

Depreciation expense for leased property was $199 and $85 for the years ended December 31, 2020 and 2019, respectively.

ACCRUED LIABILITIES

12 Months Ended

Dec. 31, 2020

ACCRUED LIABILITIES.

ACCRUED LIABILITIES

9. ACCRUED LIABILITIES

Accrued liabilities consisted of the following at December 31, 2020 and 2019:


	2020		2019
Warranty liability	$	2,594	$	3,078
Litigation reserve		899		325
Federal and state taxes payable		5,603		1,761
Accrued expenses & other accrued liabilities		5,764		3,644
Total	$	14,860	$	8,808

DEBT	12 Months Ended
DEBT	Dec. 31, 2020
DEBT
DEBT	10. DEBT Lines of Credit Revolver 1 At December 31, 2019, the Company had a revolving line of credit (“Revolver 1”) with Capital One, N.A. with a maximum credit limit of $45,000 and a maturity date of May 11, 2020. On March 30, 2020, the Company entered into an agreement with Capital One, N.A. to replace Revolver 1 with a new revolving line of credit (“New Revolver”). The New Revolver has a maximum credit limit of $70,000 and a maturity date of March 30, 2024. For the period January 1, 2020 through March 30, 2020 and for the year ended December 31, 2019, Revolver 1 accrued interest at one-month LIBOR plus 2.40%. The interest rate in effect as of December 31, 2019 was 4.09%. Amounts available under Revolver 1 were subject to a formula based on eligible consumer loans and MHP Notes and were secured by all accounts receivable and the consumer loans receivable and MHP Notes. The amount of available credit under Revolver 1 was $16,140 as of December 31, 2019. The New Revolver accrues interest at one-month LIBOR plus 2.00%. The interest rate in effect as of December 31, 2020 was 2.15%. As with Revolver 1, amounts available under the New Revolver are subject to a formula based on eligible consumer loans and MHP Notes and are secured by all accounts receivable and the consumer loans receivable and MHP Notes. The amount of available credit under the New Revolver was $33,826 as of December 31, 2020. In connection with the New Revolver, we paid certain arrangement fees and other fees of approximately $0.3 million, which were capitalized as unamortized debt issuance costs and will be amortized to interest expense over the life of the New Revolver. For the years ended December 31, 2020 and 2019, interest expense under the Capital One Revolvers was $1,020 and $396, respectively. The outstanding balance as of December 31, 2020 and 2019 was $36,174 and $28,860, respectively. The Company was in compliance with all financial covenants as of December 31, 2020, including that it maintain a tangible net worth of at least $120,000 and that it maintain a ratio of debt to EBITDA of 4 to 1, or less. Revolver 2 In April 2016, the Company entered into an agreement with Veritex Community Bank to secure an additional revolving line of credit of $15,000 (“Revolver 2”). Revolver 2 accrues interest at one-month LIBOR plus 2.50% and all unpaid principal and interest is due at maturity on April 4, 2021. Revolver 2 is secured by all finished goods inventory excluding repossessed homes. Amounts available under Revolver 2 are subject to a formula based on eligible inventory. The interest rates in effect as of March 31, 2020 and December 31, 2019 were 4.17% and 4.19%, respectively. On May 12, 2017, the Company entered into an agreement to increase the line of credit to $20,000. On October 15, 2018, Revolver 2 was amended to extend the maturity date from April 4, 2019 to April 4, 2021. The amount of available credit under Revolver 2 was $12,028 and $11,262 at March 31, 2020 and December 31, 2019, respectively. The Company was in compliance with all required covenants as of March 31, 2020. For the years ended December 31, 2020 and 2019, interest expense was $17 and $131, respectively. The outstanding balance as of March 31, 2020 and December 31, 2019 was $2,001. The Company was in compliance with the other financial covenants that it maintain a tangible net worth of at least $80,000. In April 2020, this note was paid in full and the facility was terminated. PPP Loan On April 10, 2020, the Company entered into a loan with Peoples Bank as the lender in an aggregate principal amount of $6,545,700 (the “Loan”) pursuant to the Paycheck Protection Program under the Coronavirus Aid, Relief, and Economic Security Act. The Loan was evidenced by a promissory note (the “Note”) dated April 10, 2020 and had a maturity date of April 10, 2022. The Note had an interest rate of 1.00% per annum, with the first six months of interest deferred. Principal and interest were payable monthly commencing on November 10, 2020 and could be prepaid by the Company at any time prior to maturity with no prepayment penalties. On May 1, 2020, this loan was paid in full. Notes Payable On April 7, 2011, the Company signed a promissory note for $4,830 with Woodhaven Bank. The amount due under the promissory note accrues interest at an annual rate of 3.85% through February 2, 2017 and then at the prime interest rate plus 0.60% through maturity on April 7, 2018. On April 7, 2018, the promissory note with Woodhaven Bank was renewed with varying amounts of principal and interest due through the maturity date, April 7, 2033. The promissory note calls for an interest rate of 4.25% and monthly payments of $30 with a final payment due at maturity. The note is secured by certain real property of the Company. Interest expense was $135 and for the year ended December 31, 2019. In October 2019, this note was paid in full. On May 24, 2016, the Company signed a promissory note for $515 with Eagle One, LLC collateralized by the purchase of real property located in Oklahoma City, Oklahoma. The amount due under the promissory note accrues interest at an annual rate of 6.00%. The promissory note calls for monthly principal and interest payments of $6 until June 1, 2026. Interest expense was $1 for the year ended December 31, 2019. In January 2019, this note was paid in full. PILOT Agreement In December 2016, the Company entered into a Payment in Lieu of Taxes (“PILOT”) agreement commonly offered in Georgia by local community development programs to encourage industry development. The net effect of the PILOT agreement is to provide the Company with incentives through the abatement of local, city and county property taxes and to provide financing for improvements to the Company’s Georgia plant (the “Project”). In connection with the PILOT agreement, the Putman County Development Authority provides a credit facility for up to $10,000 which can be drawn upon to fund Project improvements and capital expenditures as defined in the agreement. If funds are drawn, the Company would pay transactions costs and debt service payments. The PILOT agreement requires interest payments of 6.00% per annum on outstanding balances, which are due each December 1st through maturity on December 1, 2021, at which time all unpaid principal and interest are due. The PILOT agreement is collateralized by the assets of the Project. As of December 31, 2020, the Company had not drawn on this credit facility.

INCOME TAXES

12 Months Ended

Dec. 31, 2020

INCOME TAXES

INCOME TAXES

11. INCOME TAXES

The Company became a corporation subject to federal income taxes on January 1, 2018, see corporate conversion in Note 1. The change in tax status required the recognition of a deferred tax asset or liability for the initial temporary differences at the time of the change in status. The resulting net deferred tax liability of $2,066 was recorded as income tax expense at the date of the completion of the corporate conversion.

Significant components of the provision for income taxes are as follows (in thousands):


	Year ended
	December 31,
	2020		2019
Current:
Federal	$	8,885	$	7,849
State		1,737		973
Total current income tax provision		10,622		8,822
Deferred:
Federal		189		(70)
State		16		(6)
Total deferred income tax provision		205		(76)
Provision for income taxes	$	10,827	$	8,746

A reconciliation of the Company’s effective tax rate from operations to the U.S. federal income tax rate is as follows:


	Year ended
	December 31,
	2020		2019
Federal statutory rate	21.0	%		21.0	%
State income taxes, net of federal tax benefit	2.8			2.0
Energy efficiency credit	(2.3)			—
Other	0.7			0.3
Effective tax rate	22.2	%		23.3	%

The tax effects of cumulative temporary differences that give rise to deferred tax assets and liabilities are as follows (in thousands):


	Year ended
	December 31,
	2020		2019
Deferred tax assets:
Allowance for doubtful accounts	$	599	$	547
Reserve accounts		134		111
State taxes		263		223
Payroll taxes		297
Uniform capitalization		45		45
Total deferred tax assets		1,338		926
Deferred tax liabilities:
Installment sale revenue		(1,006)		(1,221)
Depreciation		(1,740)		(969)
Accrued interest receivable		(526)		(465)
Other		(37)		(37)
Total deferred tax liabilities		(3,309)		(2,692)
Net deferred tax liabilities	$	(1,971)	$	(1,766)

SHARE-BASED COMPENSATION

12 Months Ended

Dec. 31, 2020

SHARE-BASED COMPENSATION

SHARE-BASED COMPENSATION

12. SHARE BASED COMPENSATION

Pursuant to the Legacy Housing Corporation 2018 Incentive Compensation Plan (the “Compensation Plan”), the Company may issue up to 10.0 million equity awards to employees, directors, consultants and nonemployee service providers in the form of stock options, stock and stock appreciation rights. Stock options may be granted with a contractual life of up to ten years. At December 31, 2020, the Company had 9.7 million shares available for grant under the Compensation Plan.

In February 2019, the Company granted 120,000 restricted shares of its common stock to members of senior management. The shares were granted on February 7, 2019 and had a grant date fair value of $1,636. The shares vest at a rate of 14.3% annually, beginning on February 7, 2019, and becoming fully vested on February 7, 2025. During the second quarter of 2020, 42,857 of these restricted shares were forfeited due to the departure of a member of senior management.

The Company granted 2,936 restricted shares of its common stock to the independent directors on the Company’s Board of Directors. The shares were granted on February 7, 2019 and became fully vested on December 13, 2019.

In August 2019, the Company granted 39,526 restricted shares of its common stock to a member of senior management. The shares were granted on August 2, 2019 and had a grant date fair value of $496. The shares vest at a rate of 20.0% annually, beginning on August 2, 2020, becoming fully vested on August 2, 2024. This grant was canceled during the second quarter of 2020 due to the departure of the member of senior management.

The Company granted 1,903 restricted shares of its common stock to the independent directors on the Company’s Board of Directors. The shares were granted on March 27, 2020 and become fully vested on December 13, 2020.

The following is a summary of restricted stock units (the “RSU”) activity (in thousands, except per unit data):


	Number of Units		Weighted Average Grant date Fair Value
Nonvested, January 1, 2020	142	$	13.34
Granted	2	$	9.59
Vested	19	$	13.23
Canceled	(82)	$	13.12
Nonvested, December 31, 2020	43	$	13.46

As of December 31, 2020, approximately 43,000 RSUs remained unvested. Unrecognized compensation expense related to these RSUs at December 31, 2020 was $479 and is expected to be recognized over 4.11 years.

In February 2019, the Company granted 58,694 incentive stock options to a member of senior management at an exercise price of $13.63 per share. The options vest at a rate of 12.5% annually, beginning on February 7, 2019, and becoming fully vested on February 7, 2026. All options expire ten years after the date of grant. Weighted-average assumptions used in the Black-Scholes option pricing model for stock options granted were as follows: risk free interest rate of 2.41%; dividend yield of 0.00%; expected volatility of common stock of 65.0% and expected life of options of 7.9 years. During the second quarter of 2020, these options were forfeited due to the departure of a senior manager.

In August 2020, the Company granted 34,626 incentive stock options to a member of senior management at an exercise price of $14.44 per share. The options vest at a rate of 20.0% annually, beginning on August 10, 2021, and becoming fully vested on August 10, 2025. All options expire ten years after the date of grant. Weighted-average assumptions used in the Black-Scholes option pricing model for stock options granted were as follows: risk free interest rate of 0.24%; dividend yield of 0.00%; expected volatility of common stock of 75.0% and expected life of options of 6.5 years.

The following is a summary of option activity (in thousands, except per unit data):


	Number of Units	Weighted Average Exercise Price		Weighted Average Fair Value		Weighted Average Remaining Contractual Life	Aggregate Intrinsic Value
Outstanding, January 1, 2020	59		13.63		7.69	8.85
Granted	35	$	14.44	$	8.67	9.61	$	—
Exercised	—		—		—	—
Forfeited	(59)		13.63		7.69	—
Outstanding, December 31, 2020	35	$	14.44	$	8.67	9.61	$	23
Exercisable, December 31, 2020	—	$	—	$	—	—	$	—

As of December 31, 2020, approximately 35,000 options remained unvested. Unrecognized compensation expense related to these options at December 31, 2020 was $277 and is expected to be recognized over 4.61 years.

On March 31, 2020, the Company filed a registration statement on Form S-8 to register with the SEC approximately 2.3 million shares of Legacy common stock available for issuance under the 2018 Incentive Compensation Plan. The registration statement became effective upon filing.

COMMITMENTS AND CONTINGENCIES

12 Months Ended

Dec. 31, 2020

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES

13. COMMITMENTS AND CONTINGENCIES

As of January 1, 2020, the Company instituted a self-insured health benefits plan with a stop-loss policy, which provides medical benefits to employees electing coverage under the plan. The Company estimates and records costs for incurred but not reported medical claims and claim development. This reserve is based on historical experience and other assumptions, some of which are subjective. The Company will adjust its self-insured medical benefits reserve based on actual experience, estimated costs and changes to assumptions. At December 31, 2020, the Company accrued a $110 liability for incurred but not reported claims.

The Company is contingently liable under terms of repurchase agreements with financial institutions providing inventory financing for independent retailers of its products. These arrangements, which are customary in the industry, provide for the repurchase of products sold to retailers in the event of default by the retailer. The Company’s obligation under these repurchase agreements ceases upon the purchase of the home by the retail customer. The maximum amount for which the Company was liable under such agreements approximated $140 and $260 at December 31, 2020 and 2019, respectively, without reduction for the resale value of the homes. The Company considers its obligations on current contracts to be immaterial and accordingly have not recorded any reserve for repurchase commitment as of December 31, 2020 or 2019.

Leases. The Company leases facilities under operating leases that typically have 10‑year terms. These leases usually offer the Company a right of first refusal that affords the Company the option to purchase the leased premises under certain terms in the event the landlord attempts to sell the leased premises to a third party. Rent expense was $602 and $593 for the years ended December 31, 2020 and 2019, respectively. The Company also subleases properties to third parties, ranging from 3‑year to 11‑year terms with various renewal options. Rental income from the subleased property is included in other revenue in the Company’s statements of operations and was approximately $343 and $710 for the years ended December 31, 2020 and 2019, respectively.

Future minimum lease commitments under all non‑cancelable operating leases for each of the next five years at December 31, 2020, are as follows:


2021	$	506
2022		434
2023		422
2024		314
2025		278
Thereafter		530
Total	$	2,484

Legal Matters

The Company is party to certain legal proceedings that arise in the ordinary course and are incidental to its business. Certain of the claims pending against the Company in these proceedings allege, among other things, breach of contract and warranty, product liability and personal injury. Although litigation is inherently uncertain, based on past experience and the information currently available, management does not believe that the currently pending and threatened litigation or claims will have a material adverse effect on the Company’s financial position, liquidity or results of operations. However, future events or circumstances currently unknown to management will determine whether the resolution of pending or threatened litigation or claims will ultimately have a material effect on the Company’s financial position, liquidity or results of operations in any future reporting periods.

DERIVATIVES	12 Months Ended
DERIVATIVES	Dec. 31, 2020
Derivative Instruments and Hedges, Assets [Abstract]
DERIVATIVES	14. DERIVATIVES On February 2, 2012, the Company entered into a master interest rate swap agreement. The Company elected not to designate the interest rate swap agreements as cash flow hedges and, therefore, gains or losses on the agreements as well as the other offsetting gains or losses on the hedged items attributable to the hedged risk are recognized in current earnings. ASC 815‑10, Derivatives and Hedging, requires derivative instruments to be measured at fair value and recorded in the statements of financial position as either assets or liabilities. The Company entered into interest rate swap agreement with Capital One Bank on June 12, 2017 to fix the variable rate portion for $8,000 of the line of credit. This interest rate swap agreement matured on May 11, 2020 and is the only one outstanding during 2020. The fair value of the interest rate swap agreement at December 31, 2019 is an asset of $3 and is included in prepaid expenses and other current assets. Included in the statements of operations for the years ended December 31, 2020 and 2019 were losses of $15 and gains of $85, respectively, which are the result of the changes in the fair values of the interest rate swap agreement.

EARNINGS PER SHARE

12 Months Ended

Dec. 31, 2020

EARNINGS PER SHARE

EARNINGS PER SHARE

15. EARNINGS PER SHARE

Basic earnings per common share (“EPS”) is computed based on the weighted-average number of common shares outstanding during the reporting period. Diluted EPS is based on the weighted-average number of common shares outstanding plus the number of additional shares that would have been outstanding had the dilutive common shares been issued. The following table reconciles the numerators and denominators used in the computations of both basic and diluted EPS.


	Year ended
	December 31,
	2020		2019
Numerator:
Net income (in 000's)	$	37,995	$	28,844
Denominator:
Basic weighted-average common shares outstanding		24,226,128		24,379,667
Effect of dilutive securities:
Restricted stock grants		-		26,396
Stock options		10,267		30,891
Diluted weighted-average common shares outstanding		24,236,395		24,436,954
Earnings per share attributable to Legacy Housing Corporation
Basic	$	1.57	$	1.18
Diluted	$	1.57	$	1.18

The diluted earnings per share calculation excludes 35,935 and 143,027 potential shares for the years ended December 31, 2020 and 2019, respectively, because the effect of including these potential shares would be antidilutive.

RELATED PARTY TRANSACTIONS	12 Months Ended
RELATED PARTY TRANSACTIONS	Dec. 31, 2020
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS	16. RELATED PARTY TRANSACTIONS Bell Mobile Homes, a retailer owned by one of the Company’s significant shareholders, purchases manufactured homes from the Company. Accounts receivable balances due from Bell Mobile Homes were $1 and $549 as of December 31, 2020 and 2019, respectively. Accounts payable balances due to Bell Mobile Homes for maintenance and related services were $61 and $74 as of December 31, 2020 and 2019, respectively. Home sales to Bell Mobile Homes were $2,631 and $4,533 for the years ended December 31, 2020 and 2019, respectively.

SUBSEQUENT EVENTS	12 Months Ended
SUBSEQUENT EVENTS	Dec. 31, 2020
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS	17. SUBSEQUENT EVENTS In connection with the preparation of these financial statements, an evaluation of subsequent events was performed through the date of filing and there were no other events that have occurred that would require adjustments to the financial statements.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

12 Months Ended

Dec. 31, 2020

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The financial statements of the Company have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”).

Use of Estimates

The preparation of our financial statements in conformity with GAAP requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of income and expenses during the reporting period. Material estimates that are susceptible to significant change in the near term primarily relate to the determination of accounts receivable, loans to mobile home parks, consumer loans and notes receivable, inventory obsolescence, income taxes, fair value of financial instruments and contingent liabilities. Actual results could differ from these estimates.

Segment Reporting

The Company has one reportable segment. All of the Company’s activities are interrelated, and each activity is dependent and assessed based on how each of the activities of the Company supports the others. For example, the sale of manufactured homes is done through wholesale and retail operations that include providing transportation and consignment arrangements with dealers. The Company also provides financing options to the customers to facilitate such sale of homes. In addition, the sale of homes is directly related to financing provided by the Company. Accordingly, all significant operating and strategic decisions by the chief operating decision‑maker, the Executive Chairman of the Board, are based upon analyses of the Company as one segment or unit.

Cash and Cash Equivalents

Accounts Receivable

Included in accounts receivable are receivables from direct sales of mobile homes and sales of parts and supplies to customers, consignment fees and interest receivables.

Consumer Loans Receivable

The Company uses payment history to monitor the credit quality of the consumer loans on an ongoing basis.

Allowance for Loan Losses—Consumer Loans Receivable

Notes Receivable from Mobile Home Parks

Allowance for Loan Losses—MHP Notes

Other Notes Receivable

Inventories

Property, Plant, and Equipment

Impairment of Long‑Lived Assets

Dealer Incentive Liability

Product Warranties

A tabular presentation of the activity within the warranty liability account for the years ended December 31, 2020 and 2019 is presented below:


	2020		2019
Warranty liability, beginning of period	$	3,078	$	3,027
Product warranty accrued		1,834		3,593
Warranty costs incurred		(2,318)		(3,542)
Warranty liability, end of period	$	2,594	$	3,078

Advertising Costs

The Company expenses all advertising and marketing expenses in the period incurred. Advertising costs for the years ended December 31, 2020 and 2019 were $1,193 and $1,139, respectively.

Fair Value Measurements


Level I	Quoted prices are available in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date.
Level II	Significant observable inputs other than quoted prices in active markets for which inputs to the valuation methodology include: (1) Quoted prices for similar assets or liabilities in active markets; (2) Quoted prices for identical or similar assets or liabilities in inactive markets; (3) Inputs other than quoted prices that are observable; (4) Inputs that are derived principally from or corroborated by observable market data by correlation or other means. If the asset or liability has a specified (contractual) term, the Level II input must be observable for substantially the full term of the asset or liability.
Level III	Significant unobservable inputs that reflect an entity’s own assumptions that market participants would use in pricing the assets or liabilities.

The asset or liability fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement.

Fair Value of Financial Instruments

Revenue Recognition

For the years ended December 31, 2020 and 2019, sales to an independent third-party and its affiliates accounted for $41,263 or 28.7% and $38,439 or 26.8% of our product sales, respectively.

Disaggregation of Revenue. The following table summarizes customer contract revenues disaggregated by source of the revenue for the years ended December 31, 2020 and 2019:


	Year ended
	December 31,
	2020		2019
Product sales:
Direct sales	$	11,731	$	15,186
Commercial sales		70,186		64,358
Consignment sales		43,801		42,934
Retail store sales		17,436		16,114
Other (1)		4,876		4,604
Total product sales		148,030		143,196
Consumer and MHP loans interest:
Interest - consumer installment notes		15,979		15,908
Interest - MHP notes		9,381		6,280
Total consumer and MHP loans interest		25,360		22,188
Other		3,334		3,572
Total net revenue	$	176,724	$	168,956

(1)

Other product sales revenue from ancillary products and services including parts, freight and other services

Reserve for Repurchase Commitments

Other Income, Net

Other income primarily consists of interest related to commercial loan receivable balances and interest income earned on cash balances, reduced by interest expenses.

Interest Income

Share-based Compensation

Share-Based Compensation

Shipping and Handling Costs

Income Taxes

Concentrations

Recent Accounting Pronouncements

The Company has elected to use longer phase‑in periods for the adoption of new or revised financial accounting standards under the JOBS Act as an emerging growth company.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

12 Months Ended

Dec. 31, 2020

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Schedule of the activity within the warranty liability account


	2020		2019
Warranty liability, beginning of period	$	3,078	$	3,027
Product warranty accrued		1,834		3,593
Warranty costs incurred		(2,318)		(3,542)
Warranty liability, end of period	$	2,594	$	3,078

Schedule of disaggregation of revenue


	Year ended
	December 31,
	2020		2019
Product sales:
Direct sales	$	11,731	$	15,186
Commercial sales		70,186		64,358
Consignment sales		43,801		42,934
Retail store sales		17,436		16,114
Other (1)		4,876		4,604
Total product sales		148,030		143,196
Consumer and MHP loans interest:
Interest - consumer installment notes		15,979		15,908
Interest - MHP notes		9,381		6,280
Total consumer and MHP loans interest		25,360		22,188
Other		3,334		3,572
Total net revenue	$	176,724	$	168,956

(1)

Other product sales revenue from ancillary products and services including parts, freight and other services

CONSUMER LOANS RECEIVABLE (Tables)

12 Months Ended

Dec. 31, 2020

CONSUMER LOANS RECEIVABLE

Schedule of Consumer loans receivable, net of allowance for loan losses and deferred financing fees


	2020		2019
Consumer loans receivable	$	115,639	$	109,005
Loan discount and deferred financing fees, net		(2,814)		(3,050)
Allowance for loan losses		(905)		(913)
Consumer loans receivable, net	$	111,920	$	105,042

Schedule of allowance for loan losses


	2020		2019
Allowance for loan losses, beginning of period	$	913	$	712
Provision for loan losses		819		769
Charge offs		(827)		(568)
Allowance for loan losses	$	905	$	913

Schedule of impaired and general reserve for allowance for loan losses


	2020		2019
Total consumer loans	$	115,639	$	109,005
Total allowance for loan losses		905		913
Impaired loans individually evaluated for impairment		1,603		1,677
Specific reserve against impaired loans		558		529
Other loans collectively evaluated for allowance		114,036		107,328
General allowance for loan losses		347		384

Schedule of consumer loans receivable that are past due


	2020		%	2019		%
Total consumer loans receivable	$	115,639	100.0	$	109,005	100.0
Past due consumer loans:
31 - 60 days past due	$	954	0.8	$	267	0.2
61 - 90 days past due		221	0.2		122	0.1
91 - 120 days past due		141	0.1		103	0.1
Greater than 120 days past due		1,261	1.1		1,065	1.0
Total past due	$	2,577	2.2	$	1,557	1.4

OTHER NOTES RECEIVABLE (Tables)

12 Months Ended

Dec. 31, 2020

OTHER NOTES RECEIVABLE

Schedule of balance outstanding on the other notes receivable


	2020		2019
Outstanding principal balance	$	15,179	$	13,552
Allowance for loan losses		(75)		(74)
Total	$	15,104	$	13,478

INVENTORIES (Tables)

12 Months Ended

Dec. 31, 2020

INVENTORIES

Schedule of inventory


	2020		2019
Raw materials	$	12,713	$	9,434
Work in progress		412		383
Finished goods		22,755		29,341
Total	$	35,880	$	39,158

PROPERTY, PLANT AND EQUIPMENT (Tables)

12 Months Ended

Dec. 31, 2020

PROPERTY, PLANT AND EQUIPMENT

Schedule of property, plant and equipment


	2020		2019
Land	$	12,968	$	11,659
Buildings and leasehold improvements		10,700		10,059
Vehicles		1,664		1,580
Machinery and equipment		4,127		3,653
Furniture and fixtures		298		214
Total		29,757		27,165
Less accumulated depreciation		(7,141)		(6,127)
Total property, plant and equipment	$	22,616	$	21,038

OTHER ASSETS (Tables)

12 Months Ended

Dec. 31, 2020

OTHER ASSETS

Schedule of Other Assets


	2020		2019
Leased property	$	7,218	$	2,067
Prepaid rent		274		299
Repossessed homes		1,395		1,846
Total	$	8,887	$	4,212

ACCRUED LIABILITIES (Tables)

12 Months Ended

Dec. 31, 2020

ACCRUED LIABILITIES.

Schedule of accrued liabilities


	2020		2019
Warranty liability	$	2,594	$	3,078
Litigation reserve		899		325
Federal and state taxes payable		5,603		1,761
Accrued expenses & other accrued liabilities		5,764		3,644
Total	$	14,860	$	8,808

INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2020

INCOME TAXES

Summary of significant components of the provision for income taxes

Significant components of the provision for income taxes are as follows (in thousands):


	Year ended
	December 31,
	2020		2019
Current:
Federal	$	8,885	$	7,849
State		1,737		973
Total current income tax provision		10,622		8,822
Deferred:
Federal		189		(70)
State		16		(6)
Total deferred income tax provision		205		(76)
Provision for income taxes	$	10,827	$	8,746

Schedule of reconciliation of the Company’s effective tax rate from operations to the U.S. federal income tax rate


	Year ended
	December 31,
	2020		2019
Federal statutory rate	21.0	%		21.0	%
State income taxes, net of federal tax benefit	2.8			2.0
Energy efficiency credit	(2.3)			—
Other	0.7			0.3
Effective tax rate	22.2	%		23.3	%

Summary of deferred tax assets and liabilities

The tax effects of cumulative temporary differences that give rise to deferred tax assets and liabilities are as follows (in thousands):


	Year ended
	December 31,
	2020		2019
Deferred tax assets:
Allowance for doubtful accounts	$	599	$	547
Reserve accounts		134		111
State taxes		263		223
Payroll taxes		297
Uniform capitalization		45		45
Total deferred tax assets		1,338		926
Deferred tax liabilities:
Installment sale revenue		(1,006)		(1,221)
Depreciation		(1,740)		(969)
Accrued interest receivable		(526)		(465)
Other		(37)		(37)
Total deferred tax liabilities		(3,309)		(2,692)
Net deferred tax liabilities	$	(1,971)	$	(1,766)

SHARE-BASED COMPENSATION (Tables)

12 Months Ended

Dec. 31, 2020

SHARE-BASED COMPENSATION

Schedule of restricted stock units activity

The following is a summary of restricted stock units (the “RSU”) activity (in thousands, except per unit data):


	Number of Units		Weighted Average Grant date Fair Value
Nonvested, January 1, 2020	142	$	13.34
Granted	2	$	9.59
Vested	19	$	13.23
Canceled	(82)	$	13.12
Nonvested, December 31, 2020	43	$	13.46

Schedule of stock option activity

The following is a summary of option activity (in thousands, except per unit data):


	Number of Units	Weighted Average Exercise Price		Weighted Average Fair Value		Weighted Average Remaining Contractual Life	Aggregate Intrinsic Value
Outstanding, January 1, 2020	59		13.63		7.69	8.85
Granted	35	$	14.44	$	8.67	9.61	$	—
Exercised	—		—		—	—
Forfeited	(59)		13.63		7.69	—
Outstanding, December 31, 2020	35	$	14.44	$	8.67	9.61	$	23
Exercisable, December 31, 2020	—	$	—	$	—	—	$	—

COMMITMENTS AND CONTINGENCIES (Tables)

12 Months Ended

Dec. 31, 2020

COMMITMENTS AND CONTINGENCIES

Schedule of future minimum lease commitments


2021	$	506
2022		434
2023		422
2024		314
2025		278
Thereafter		530
Total	$	2,484

EARNINGS PER SHARE (Tables)

12 Months Ended

Dec. 31, 2020

EARNINGS PER SHARE

Summary of reconciliation of the numerators and denominators used in the computations of both basic and diluted EPS


	Year ended
	December 31,
	2020		2019
Numerator:
Net income (in 000's)	$	37,995	$	28,844
Denominator:
Basic weighted-average common shares outstanding		24,226,128		24,379,667
Effect of dilutive securities:
Restricted stock grants		-		26,396
Stock options		10,267		30,891
Diluted weighted-average common shares outstanding		24,236,395		24,436,954
Earnings per share attributable to Legacy Housing Corporation
Basic	$	1.57	$	1.18
Diluted	$	1.57	$	1.18

NATURE OF OPERATIONS - IPO and Corporate Conversion (Details) - USD ($) $ / shares in Units, $ in Thousands			1 Months Ended		12 Months Ended
	Apr. 17, 2019	Jan. 01, 2018	Jan. 31, 2019	Dec. 31, 2018	Dec. 31, 2020	Dec. 31, 2019
Nature of operations
Shares issued upon incorporation (in shares)		20,000,000
Offering costs						$ 505
Shares repurchased	300,000				145,065
Share repurchase price (in dollars per share)	$ 10.20				$ 9.77
Stock Repurchase Program, Authorized Amount					$ 10,000
IPO
Nature of operations
Shares issued from sale of common stock			600,000	4,000,000
Share price (in dollars per share)			$ 12.00	$ 12.00
Offering costs			$ 505	$ 4,504
Proceeds from IPO net of underwriting discounts and offering expenses			$ 6,695	$ 43,492

NATURE OF OPERATIONS - Segment Reporting (Details)	12 Months Ended
NATURE OF OPERATIONS - Segment Reporting (Details)	Dec. 31, 2020 segment
NATURE OF OPERATIONS
Number of reportable segment	1

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Cash and Cash Equivalents (Details) $ in Thousands	Dec. 31, 2020 USD ($) item
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Number of banks exceeding the FDIC limit \| item	1
Cash in excess of FDIC limit \| $	$ 518

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Accounts Receivable, Consumer Loans Receivable, Notes Receivable from Mobile Home Parks, Other Notes Receivable (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2020 USD ($) item	Dec. 31, 2019 USD ($)
Accounts Receivable
Credit period	30 days
Allowance for doubtful accounts	$ 97	$ 457
Consumer Loans Receivable
Average contractual interest rate	13.80%	14.00%
Escrow liability	$ 7,729	$ 7,530
Number of components comprising the allowance for loan losses \| item	2
General reserve calculation, period of historical loss rate	3 years
Principal outstanding on consumer loans	$ 1,603	1,677
Repossessed Assets	$ 1,395	$ 1,846
Minimum
Consumer Loans Receivable
Consumer loans receivable term	2 years
Maximum
Consumer Loans Receivable
Consumer loans receivable term	30 years
Notes Receivable from Mobile Home Parks
Consumer Loans Receivable
Note receivable with fixed rate of interest	$ 109,000
Interest rate spread on the MHP Notes	4.00%
Interest rate on the MHP Notes	7.70%	8.70%
Charge offs	$ 0	$ 0
Allowance for loan losses	$ 0	$ 0
Notes Receivable from Mobile Home Parks \| Minimum
Consumer Loans Receivable
Fixed rate of interest (as a percent)	5.00%
Interest rate spread on the MHP Notes	8.00%
Term of notes receivables	1 year	1 year
Notes Receivable from Mobile Home Parks \| Maximum
Consumer Loans Receivable
Fixed rate of interest (as a percent)	9.50%
Term of notes receivables	20 years	20 years
Other Note Receivable
Consumer Loans Receivable
Allowance for loan losses	$ 75	$ 74
Other Note Receivable \| Minimum
Consumer Loans Receivable
Interest rate on the other notes	6.25%
Other Note Receivable \| Maximum
Consumer Loans Receivable
Interest rate on the other notes	12.00%
Notes Receivable from Mobile Home Parks \| Customer concentration risk \| Independent third party and affiliates
Consumer Loans Receivable
Concentration risk percentage	52.90%	38.30%

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Inventory, Property, plant and equipment, Impairment of Long Lived Assets (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Impairment for long-lived assets	$ 0	$ 0
Non current inventory	$ 8,656	$ 11,930
Buildings and improvements \| Minimum
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Useful lives	30 years
Buildings and improvements \| Maximum
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Useful lives	39 years
Vehicles
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Useful lives	5 years
Machinery and equipment
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Useful lives	7 years
Furniture and fixtures
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Useful lives	7 years

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Dealer Incentive Liability, Advertising Costs (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Dealer Incentive Liability
Dealer incentive liability	$ 4,242	$ 5,531
Dealer incentive expense	$ 336	$ 731

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Product Warranty (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Term of product warranty	1 year	1 year
Warranty liability, beginning of period	$ 3,078	$ 3,027
Product warranty accrued	1,834	3,593
Warranty costs incurred	(2,318)	(3,542)
Warranty liability, end of period	2,594	3,078
Advertising Costs	$ 1,193	$ 1,139

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Fair value measurement (Details) $ in Thousands	Dec. 31, 2019 USD ($)
Interest rate swap agreement \| Level 2
Interest Rate Derivative Assets, at Fair Value	$ 3

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Fair value of financial instruments (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Consumer Loan \| Fair Value \| Level 3
Fair value of financial instruments
Loans	$ 115,000	$ 101,000
Consumer Loan \| Book Value
Fair value of financial instruments
Loans	111,742	105,042
Notes Receivable from Mobile Home Parks \| Fair Value \| Level 3
Fair value of financial instruments
Notes receivable	108,000	85,000
Notes Receivable from Mobile Home Parks \| Book Value
Fair value of financial instruments
Notes receivable	109,806	86,881
Other Note Receivable \| Fair Value \| Level 3
Fair value of financial instruments
Notes receivable	15,000	14,000
Other Note Receivable \| Book Value
Fair value of financial instruments
Notes receivable	$ 15,104	$ 13,478

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Revenue Recognition (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Jan. 01, 2019
Disaggregation of revenue
Product sales	$ 148,030	$ 143,196
Incremental costs of obtaining a contract	true
Dealer commission, reimbursed dealer expenses and other similar costs	$ 24,165	23,760
Revenue from contract with customer product and service benchmark \| Customer concentration risk \| Independent third party and affiliates
Disaggregation of revenue
Product sales	$ 41,263	$ 38,439
Concentration risk percentage	28.70%	26.80%
ASU 2014-09
Disaggregation of revenue
Impact of adoption			$ 0

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Disaggregation of Revenue (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Disaggregation of Revenue
Product sales	$ 148,030	$ 143,196
Consumer and MHP loans interest:
Interest - consumer installments notes	15,979	15,908
Interest - MHP notes	9,381	6,280
Total consumer and MHP loans interest	25,360	22,188
Other	3,334	3,572
Total net revenue	176,724	168,956
Direct sales
Disaggregation of Revenue
Product sales	11,731	15,186
Commercial sales
Disaggregation of Revenue
Product sales	70,186	64,358
Consignment sales
Disaggregation of Revenue
Product sales	43,801	42,934
Retail store sales
Disaggregation of Revenue
Product sales	17,436	16,114
Other
Disaggregation of Revenue
Product sales	$ 4,876	$ 4,604

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Income Taxes (Details) - USD ($) $ in Thousands		12 Months Ended
	Jan. 01, 2018	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2017	Dec. 31, 2018
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Shipping and handling costs		$ 706	$ 525
Federal tax rate	21.00%	21.00%	21.00%	35.00%
Uncertain tax positions		$ 0	$ 0		$ 0

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Concentrations (Details)	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Notes Receivable from Mobile Home Parks \| Independent third party and affiliates \| Customer concentration risk
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Concentration risk percentage	52.90%	38.30%

CONSUMER LOANS RECEIVABLE - Consumer loans receivable, net (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
CONSUMER LOANS RECEIVABLE
Consumer loans receivable	$ 115,639	$ 109,005
Loan discount and deferred financing fees, net	(2,814)	(3,050)
Allowance for loan losses	(905)	(913)	$ (712)
Consumer loans receivable, net	$ 111,920	$ 105,042

CONSUMER LOANS RECEIVABLE - Allowance for loan losses (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
CONSUMER LOANS RECEIVABLE
Allowance for loan losses, beginning of period	$ 913	$ 712
Provision for loan losses	819	769
Charge offs	(827)	(568)
Allowance for loan losses, end of period	$ 905	$ 913

CONSUMER LOANS RECEIVABLE - Impaired and general reserve for allowance for loan losses (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
CONSUMER LOANS RECEIVABLE
Total consumer loans receivable	$ 115,639	$ 109,005
Total allowance for loan losses	905	913	$ 712
Impaired loans individually evaluated for impairment	1,603	1,677
Specific reserve against impaired loans	558	529
Other loans collectively evaluated for allowance	114,036	107,328
General allowance for loan losses	$ 347	$ 384

CONSUMER LOANS RECEIVABLE - Aging of consumer loans receivable (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Past due consumer loans:
Total consumer loans receivable	$ 115,639	$ 109,005
Total consumer loans receivable (as a percent)	100.00%	100.00%
Consumer loans receivable past due	$ 2,577	$ 1,557
Consumer loans receivable past due (Percent)	2.20%	1.40%
31 - 60 days past due
Past due consumer loans:
Consumer loans receivable past due	$ 954	$ 267
Consumer loans receivable past due (Percent)	0.80%	0.20%
61 - 90 days past due
Past due consumer loans:
Consumer loans receivable past due	$ 221	$ 122
Consumer loans receivable past due (Percent)	0.20%	0.10%
91 - 120 days past due
Past due consumer loans:
Consumer loans receivable past due	$ 141	$ 103
Consumer loans receivable past due (Percent)	0.10%	0.10%
Greater than 120 days past due
Past due consumer loans:
Consumer loans receivable past due	$ 1,261	$ 1,065
Consumer loans receivable past due (Percent)	1.10%	1.00%

NOTES RECEIVABLE FROM MOBILE HOME PARKS (MHP Notes) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Notes Receivable from Mobile Home Parks
Notes Receivable
Unamortized finance fees	$ 200	$ 0
Charge offs	0	0
Allowance for loan losses	$ 0	$ 0
Notes Receivable from Mobile Home Parks \| Credit concentration risk \| Independent third party and affiliates
Notes Receivable
Concentration risk percentage	52.90%	38.30%

OTHER NOTES RECEIVABLE (Details) - Other Note Receivable - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Notes Receivable
Outstanding principal balance	$ 15,179	$ 13,552
Allowance for loan losses	(75)	(74)
Total	$ 15,104	$ 13,478

INVENTORIES (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
INVENTORIES
Raw materials	$ 12,713	$ 9,434
Work in progress	412	383
Finished goods	22,755	29,341
Total	$ 35,880	$ 39,158

PROPERTY, PLANT AND EQUIPMENT (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
PROPERTY, PLANT AND EQUIPMENT
Total	$ 29,757	$ 27,165
Less accumulated depreciation	(7,141)	(6,127)
Total property, plant and equipment	22,616	21,038
Depreciation expense	1,013	929
Cost of product sales
PROPERTY, PLANT AND EQUIPMENT
Depreciation expense	409	370
Land
PROPERTY, PLANT AND EQUIPMENT
Total	12,968	11,659
Buildings and leasehold improvements
PROPERTY, PLANT AND EQUIPMENT
Total	10,700	10,059
Vehicles
PROPERTY, PLANT AND EQUIPMENT
Total	1,664	1,580
Machinery and equipment
PROPERTY, PLANT AND EQUIPMENT
Total	4,127	3,653
Furniture and fixtures
PROPERTY, PLANT AND EQUIPMENT
Total	$ 298	$ 214

OTHER ASSETS (Details) - USD ($) $ in Thousands	12 Months Ended
OTHER ASSETS (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
OTHER ASSETS
Leased property	$ 7,218	$ 2,067
Prepaid rent	274	299
Repossessed homes	1,395	1,846
Total	8,887	4,212
Depreciation expense on leased property	$ 199	$ 85

ACCRUED LIABILITIES (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
ACCRUED LIABILITIES.
Warranty liability	$ 2,594	$ 3,078
Litigation reserve	899	325
Federal and state taxes payable	5,603	1,761
Accrued expenses & other accrued liabilities	5,764	3,644
Total	$ 14,860	$ 8,808

DEBT - Lines of Credit (Details) $ in Thousands	3 Months Ended	12 Months Ended
DEBT - Lines of Credit (Details) $ in Thousands	Mar. 30, 2020 USD ($)	Dec. 31, 2020 USD ($)	Dec. 31, 2019 USD ($)	Mar. 31, 2020	May 12, 2017 USD ($)	Apr. 30, 2016 USD ($)
Revolver 1
Lines of Credit
Maximum borrowing capacity	$ 70,000		$ 45,000
Effective interest rate		2.15%	4.09%
Amount of available credit		$ 33,826	$ 16,140
Interest expense		1,020	396
Outstanding balance		36,174	$ 28,860
Tangible net worth		$ 120,000
Debt to EBITDA ratio		4
Payments of arrangement fees and other fees		$ 300
Revolver 1 \| London Interbank Offered Rate (LIBOR)
Lines of Credit
Spread rate	2.40%	2.00%	2.40%
Revolver 2
Lines of Credit
Maximum borrowing capacity					$ 20,000	$ 15,000
Effective interest rate			4.19%	4.17%
Amount of available credit	$ 12,028		$ 11,262
Interest expense		$ 17	131
Outstanding balance	$ 2,001		$ 2,001
Tangible net worth		$ 80,000
Revolver 2 \| London Interbank Offered Rate (LIBOR)
Lines of Credit
Spread rate		2.50%

DEBT - PPP Loans and Notes Payable (Details) - USD ($)				12 Months Ended	14 Months Ended
DEBT - PPP Loans and Notes Payable (Details) - USD ($)	Apr. 10, 2020	Apr. 07, 2018	May 24, 2016	Dec. 31, 2019	Apr. 07, 2018	Feb. 02, 2017	Dec. 31, 2016	Apr. 07, 2011
Promissory note with Woodhaven Bank
Notes Payable
Face amount								$ 4,830,000
Interest rate		4.25%			4.25%	3.85%
Frequency of periodic payment		monthly
Principal and interest payments		$ 30,000
Interest expense				$ 135,000
Promissory note with Woodhaven Bank \| Prime Rate
Notes Payable
Spread rate					0.60%
Promissory note with Eagle One LLC
Notes Payable
Face amount			$ 515,000
Interest rate			6.00%
Frequency of periodic payment			monthly
Principal and interest payments			$ 6,000
Interest expense				$ 1,000
Paycheck Protection Program
Notes Payable
Face amount	$ 6,545,700
Interest rate	1.00%
Period of deferred interest	6 months
Prepayment penalties	$ 0
PILOT Agreement
Notes Payable
Maximum borrowing capacity							$ 10,000,000
Interest rate							6.00%

INCOME TAXES (Details) - USD ($) $ in Thousands		12 Months Ended
INCOME TAXES (Details) - USD ($) $ in Thousands	Jan. 01, 2018	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2017
Income Taxes
Change in tax status net deferred tax liability	$ 2,066
Current:
Federal		$ 8,885	$ 7,849
State		1,737	973
Total current income tax provision		10,622	8,822
Deferred:
Federal		189	(70)
State		16	(6)
Total deferred income tax provision		205	(76)
Provision for income taxes		$ 10,827	$ 8,746
Effective Income Tax Rate Reconciliation
Federal statutory rate	21.00%	21.00%	21.00%	35.00%
State income taxes, net of federal tax benefit		2.80%	2.00%
Energy efficiency credit		(2.30%)
Other		0.70%	0.30%
Effective tax rate (as a percent)		22.20%	23.30%
Deferred tax assets:
Allowance for doubtful accounts		$ 599	$ 547
Reserve accounts		134	111
State taxes		263	223
Payroll taxes		297
Uniform capitalization		45	45
Total deferred tax assets		1,338	926
Deferred tax liabilities:
Installment sale revenue		(1,006)	(1,221)
Depreciation		(1,740)	(969)
Accrued interest receivable		(526)	(465)
Other		(37)	(37)
Total deferred tax liabilities		(3,309)	(2,692)
Net deferred tax liabilities		$ (1,971)	$ (1,766)

SHARE-BASED COMPENSATION - Plan (Details) - USD ($) $ in Thousands					3 Months Ended	12 Months Ended
	Aug. 10, 2020	Mar. 27, 2020	Aug. 02, 2019	Feb. 07, 2019	Jun. 30, 2020	Dec. 31, 2020
SHARE-BASED COMPENSATION
Number of shares may be issued to employees, directors, consultants and nonemployee service providers in the form of stock options, stock and stock appreciation rights						10,000,000
Number of shares available for grant						9,700,000
Stock options
SHARE-BASED COMPENSATION
Contractual life						10 years
Stock options \| Senior management
SHARE-BASED COMPENSATION
Contractual life	10 years			10 years
Vesting percentage	20.00%			12.50%
Restricted shares \| Senior management
SHARE-BASED COMPENSATION
Restricted shares granted (in shares)			39,526	120,000
Grant date fair value			$ 496	$ 1,636
Vesting percentage			20.00%	14.30%
Restricted shares forfeited (in shares)					42,857
Restricted shares \| Independent directors
SHARE-BASED COMPENSATION
Restricted shares granted (in shares)		1,903		2,936

SHARE-BASED COMPENSATION - Restricted stock units (Details) - Restricted stock units $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2020 USD ($) $ / shares shares
Number of units
Nonvested at the beginning \| shares	142,000
Granted \| shares	2,000
Vested \| shares	19,000
Canceled \| shares	(82,000)
Nonvested at the end \| shares	43,000
Weighted average grant date fair value
Nonvested at the beginning (in dollars per share) \| $ / shares	$ 13.34
Granted (in dollars per share) \| $ / shares	9.59
Vested (in dollars per share) \| $ / shares	13.23
Canceled (in dollars per share) \| $ / shares	13.12
Nonvested at the end (in dollars per share) \| $ / shares	$ 13.46
Unrecognized compensation expense \| $	$ 479
Unrecognized compensation expense, recognition period	4 years 1 month 10 days

SHARE-BASED COMPENSATION - Stock options (Details) - Stock options - $ / shares			12 Months Ended
	Aug. 10, 2020	Feb. 07, 2019	Dec. 31, 2020
SHARE-BASED COMPENSATION
Stock options granted (in shares)			35,000
Exercise price (in dollar per share)			$ 14.44
Fair value assumptions for options granted
Expiration period			10 years
Senior management
SHARE-BASED COMPENSATION
Stock options granted (in shares)	34,626	58,694
Exercise price (in dollar per share)	$ 14.44	$ 13.63
Vesting percentage	20.00%	12.50%
Fair value assumptions for options granted
Risk free interest rate	0.24%	2.41%
Dividend yield	0.00%	0.00%
Expected volatility	75.00%	65.00%
Expiration period	10 years	10 years
Expected life	6 years 6 months	7 years 10 months 24 days

SHARE-BASED COMPENSATION - Summary of Stock options activity (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Mar. 31, 2020
2018 Incentive Compensation Plan
Weighted Average Remaining Contractual Life and Intrinsic Value
Common stock available for issuance			2,300,000
Stock options
Number of units
Outstanding at the beginning	59,000
Awards granted	35,000
Forfeited	(59,000)
Outstanding at the end	35,000	59,000
Weighted Average Exercise Price
Outstanding at the beginning (in dollars per share)	$ 13.63
Granted (in dollars per share)	14.44
Forfeited (in dollars per share)	13.63
Outstanding at the end (in dollars per share)	14.44	$ 13.63
Weighted Average Fair Value
Outstanding at the beginning (in dollars per share)	7.69
Granted (in dollars per share)	8.67
Forfeited (in dollars per share)	7.69
Outstanding at the end (in dollars per share)	$ 8.67	$ 7.69
Weighted Average Remaining Contractual Life and Intrinsic Value
Granted (in years)	9 years 7 months 10 days
Outstanding (in years)	9 years 7 months 10 days	8 years 10 months 6 days
Outstanding at the end (in dollars)	$ 23
Non-vested shares	35,000
Unrecognized compensation expense	$ 277
Unrecognized compensation expense, recognition period	4 years 7 months 10 days

COMMITMENTS AND CONTINGENCIES (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Commitment
Self-insured liability	$ 110
Repurchase agreements \| Maximum
Commitment
Repurchase commitment	$ 140	$ 260

COMMITMENTS AND CONTINGENCIES - Leases (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Operating Leased Assets [Line Items]
Operating lease, term of contract (in years)	10 years
Rent expense	$ 602	$ 593
Sublease rental income	343	$ 710
Future minimum lease commitments
2021	506
2022	434
2023	422
2024	314
2025	278
Thereafter	530
Total	$ 2,484
Minimum
Operating Leased Assets [Line Items]
Sublease, term of contract (in years)	3 years
Maximum
Operating Leased Assets [Line Items]
Sublease, term of contract (in years)	11 years

DERIVATIVES (Details) - Interest rate swap agreement - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Jun. 12, 2017
Derivative instruments
Losses (gains) resulted from changes in fair values of the interest rate swap agreement	$ 15	$ (85)
Line of credit
Derivative instruments
Interest rate swap agreement			$ 8,000
Prepaid Expenses and Other Current Assets
Derivative instruments
Fair values of interest rate swap agreement		$ 3

EARNINGS PER SHARE- Tabular (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Numerator:
Net income (in 000's)	$ 37,995	$ 28,844
Denominator:
Basic weighted-average common shares outstanding	24,226,128	24,379,667
Effect of dilutive securities:
Diluted weighted-average common shares outstanding	24,236,395	24,436,954
Earnings per share attributable to Legacy Housing Corporation
Basic	$ 1.57	$ 1.18
Diluted	$ 1.57	$ 1.18
Restricted stock units
Effect of dilutive securities:
Dilutive securities		26,396
Stock options
Effect of dilutive securities:
Dilutive securities	10,267	30,891

EARNINGS PER SHARE - Antidilutive Securities (Details) - shares	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Earnings Per Share, Diluted, Other Disclosures [Abstract]
Antidilutive shares excluded from calculation of earnings per share	35,935	143,027

RELATED PARTY TRANSACTIONS (Details) - Bell Mobile Homes - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
RELATED PARTY TRANSACTIONS
Accounts receivable related parties	$ 1	$ 549
Accounts payable related parties	61	74
Home sales to related parties	$ 2,631	$ 4,533