Manufactured Homes in Pennsylvania

Underwriting

Mobile homes and manufactured housing (pre-fabricated) units are not insurable interests in realty unless they are permanently attached to the land on which they are placed. Some mobile homes are located in trailer parks on leased property registered with PennDOT like a car or truck and titled as such. This creates difficulties in insuring any type of mobile/manufactured housing unit as part of a real estate loan or sale transaction.

The ALTA 7.1-06 (loan) and 7.2-06 (owners) are not available in Pennsylvania.

PA Endorsement 400 (ALTA Endorsement 7-06)

This Endorsement expands the definition of the term "Land" in the Policy to include "the manufactured housing unit located on the land described in Schedule A at Date of Policy."

• The home must be permanently affixed to the land on which it is situated (i.e. removal of axle and wheels; placed on a permanent foundation; connected to local water and sewer systems, or other available utilities in the community, etc.). This can be confirmed by visual inspection and/or an affidavit and survey
• An Affidavit of Affixation must be executed by all persons with an ownership interest in the manufactured home. Lenders will often have a form manufactured/mobile home Affidavit that they use, which would likely be acceptable.
• The municipal tax records must show that the home is taxes as part of the land, as an improvement, and the land is not "vacant".
• Any vehicle title must be cancelled. A Pennsylvania Department of Transportation ("PennDOT") search must be run against all current and prior owners showing in the standard title search to see if a vehicle title exists for the manufactured home. A PennDOT search is not typically included in the title search so it may need to be separately ordered.
  • If the PennDOT search reveals an active vehicle title for the manufactured home, that title must be cancelled prior to closing. If the title is registered in a prior owner's name, and the current Owner does not possess the original Certificate of Title, they can apply to PennDOT for a transfer of the title and then request cancellation. The owner of the home must also be the owner of the land on which it is situated.
  • If the vehicle title reveals any liens on the manufactured home, they should be disposed or discharged just like liens on the land's title. Often the lien will be from a mortgage that was also recorded in the Recorder of Deeds Office against the land. If that mortgage has been satisfied, it may be possible to show that the vehicle title lien should be removed as well. Please speak with underwriting if there are any questions in this regard.
• A Uniform Commercial Code (UCC) Search must be made at both the state level (PA Department of State) and the county Recorder of Deeds level where the land is located. If any are filed, the Commitment must require that they be terminated of record. Per 13 Pa.C.S. § 9515(b), a UCC Financing Statement filed in connection with a "manufactured-home transaction" lasts at least 30 years and can be continued.

Manufactured Homes

Manufactured homes are constructed off-site and under federal Department of Housing and Urban Development ("HUD") regulations. Manufactured homes are transported to the site and installed. Manufactured homes will contain certification labels (HUD tags) which is a metal plat affixed to the outside of the manufactured home. There will also be a "data plate" which is a paper label affixed inside the home in a kitchen cabinet, electrical panel, or a bedroom closet. Labels can be verified with the Institute for Building Technology and Safety

Modular Homes

Modular homes are similar to manufactured homes in that any or all of the sections may be pre-built off-site and then transported and installed on the land. Modular homes differ from manufactured homes in that they are not built to HUD regulations and must conform in all respects with the applicable local building codes. As such, modular homes are typically considered the same as standard site-built homes. If there is any doubt, a PennDOT search should be run, the home should be inspected for HUD tags, and/or a search run with IBTS to confirm (see above).

Mobile Homes

Mobile homes are not permanently affixed to the land (whether or not they currently have wheels) and are considered personal property, separate from the real estate. Mobile homes are often on land that is leased by the homeowner. The mobile home will be transferred by the Certificate of Title as a vehicle, separate from the land. As personal property, title to the mobile home cannot be insured by title insurance. Leasehold title insurance may be available for the lease of the land.

References

• WFG Underwriting Bulletin PA 2017-04 (August 28, 2016)
• PennDOT Fact Sheet: Titling a Mobile Home or Manufactured Home
• PennDOT Form MV-16: Application for Cancellation of Certificate of Title.
• HUD Certification Labels (HUD Tags)
• IBTS Manufactured Home Certifications