Puzzled About Manufactured Home Lending and Title Requirements?

Manufactured Home Lending and Title Requirements

California: The 433A Curative Title Solution

The Personal vs. Real Property Puzzle: Manufactured homes that are situated on deeded real property may still be classified as personal property (chattel) with the Department of Housing and Community Development (HCD) even though the borrower is paying property tax! Since most lenders, title companies and attorneys require proof that the home is attached to and classified as real estate, a last minute discovery that a home has not been properly converted can impede a time sensitive transaction or foreclosure. Unlike other states where "detitling" or classifying a manufactured home as real property is a paper process that can be expedited by a homeowner or escrow with relative ease, California has a collection of jigsaw pieces that need to be matched up perfectly.

Curative title requires cooperation of a building authority, contractor, and HCD, all working collectively, We are uniquely qualified for California's title perfection and conversion process. MH-Processing can put the pieces of the puzzle together, working with contractors, building departments and the Department of Housing and Community Development to tackle California's unique 433A issues.

Nationwide: The Foundation Certification Solution

Lenders generally want to throw up their hands when a manufactured home loan comes across their desk. Even if a borrower has great income, an ideal FICO score, and an "on target" appraisal value, that might not be enough to satisfy underwriting.

In some ways, manufactured homes are treated like the ugly stepchild of the housing industry. The disparaging treatment is less about the type of borrower or even the structure itself, than the fact that manufactured homes are tricky business. It's the laundry list of conditions that is the real problem! For instance, if a home was manufactured before a certain date or was previously moved, the loan can be "Dead On Arrival". FHA-insured loans and sometime VA also require a site specific certification of the foundation to meet HUD guidelines by a Professional Engineer. It's an endless list!

So where do you go for specialized information or troubleshooting ?

MH Processing of course! We can help you tackle most manufactured home issues for the sales and lending process, whether it is a HUD compliant Engineer's Certification or a foundation repair. We have a nationwide network of engineers and contractors knowledgeable about the HUD guidelines. We talk lender language so let us tackle the difficult questions.

The California Puzzle

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What does California consider a permanent foundation? In California an engineer's certification alone is not enough to verify a foundation. A recorded "Notice of Installation" aka 433A is the recognized California stamp of approval for a permanent foundation. Beyond proof of a permanent foundation, the 433A is also a title conversion document verifying that the home and land are conjoined as real property. So how does one acquire a 433? California has a number of stamped and approved engineered plans that carry the designation "Permanent Foundation" under Health and Safety Statute Title 25, Section 18551, which can be installed by one of our network contractors. Presenting these plans to the local building department for a permit, having a contractor install a system (followed by a building inspection and 433A sign-off) and then recording is all part of the standard modus operandi. MH-Processing has 25 years of working with building departments, code enforcement, Department of Housing and Assessor's Offices for a turnkey title and recordation proces

The Foundation Puzzle

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How do you determine if a manufactured home has a Permanent Foundation? Since HUD does not have a blanket foundation approval policy and different manufacturers have different designs, foundation determination can be open for interpretation. Therefore to protect lender and provide FHA/HUD with compliance continuity, a certification by a civil or structural engineer specifying that the foundation meets HUD Permanent Foundation Guide For Manufactured Homes, September 1996 is required on all FHA-insured loans. MH-Processing has a qualified network of engineers and foundation repair experts.

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