The Inclusive Economy
Manufactured Housing Meets Music City
By Lauren Williams on 07/19/2012 @ 10:00 AM
The Uniform Manufactured Housing Act Passes with Overwhelming Support
On a steamy Saturday afternoon in July, more than 300 lawyers—including state legislators, practitioners, judges and law professors—descended on Nashville, Tennessee for their Annual Meeting, a week-long exercise in crafting model state laws to improve uniformity and consistency. For two days, these members of the Uniform Law Commission (ULC) debated the intricacies of real property law, the procedural details of converting manufactured home titles from personal to real property, the implications of improving that process for homeowners, state governments and industry, and the painstakingly elaborate stylistic details of legal writing. While the Act was under consideration on the floor, commissioners from every state were able to ask questions, recommend amendments and register their support.
The Act’s Drafting Committee spent several hours after their presentation of the Act carefully considering the input received from the floor and making adjustments where they saw fit. At the final vote of the states on Wednesday, July 18, the Uniform Manufactured Housing Act passed with resounding support from 48 states and opposition from none.
What does it all mean? As Vermont Commissioner and Drafting Committee Chair, Carl Lisman, said in his opening address—there are four main constituencies with a vital stake in this Act: manufacturers, lenders, homeowners and the Uniform Law Commission. This Manufactured Housing Act—a simpler, clearer, more uniform system for converting manufactured homes from personal to real property—serves the best interests of all those stakeholders. A better titling process guarantees homeowners and buyers a better shot at accessing fair, safe and affordable mortgage financing and affords them with a set of consumer protections parallel to those that site-built homeowners receive. Additionally, more consistent titling legislation across different states should make it easier for major national lenders offering manufactured home mortgage financing to operate across state lines. Among other things, the Act offers the following key components:
- Provides an easy method to convert manufactured homes to real property—a new home can be considered real property as soon as the homeowner (1) locates the home on land controlled by the homeowner and connects the home to electricity and (2) files a certificate of location for recording in the land records
- Requires that dealers provide information to purchasers of manufactured homes about their rights to convert the home to real property
- Does not include onerous requirements that manufactured homes be placed on so-called “permanent foundations” or satisfy certain lease terms in land-lease communities in order to become real property
- Prohibits steering by the seller or manufactured home dealer into a certain type of titling
- Addresses the possibility that the home is later moved
The ULC is a 120 year old organization that “provides states with non-partisan, well-conceived and well-drafted legislation that brings clarity and stability to critical areas of state law.” The Act’s passage represents a significant milestone and a serious victory for advocates serving owners of manufactured homes and industry players who recognize the value proposition created when it becomes easier to title manufactured homes as real property. Because of the ULC’s reputation and uniquely open drafting process that draws expertise from commissioners and outside advisors, their approval of the Act lends legitimacy and clout to advocates’ efforts to enact it at the state level.
What’s next? Getting the Uniform Act drafted and passed was a collaborative two-year effort on the part of the Drafting Committee and the many supporters from the field. I’M HOME Network members—including the National Consumer Law Center, Self-Help Credit Union, the Fair Mortgage Collaborative and the Manufactured Home Owners Association of America, along with CFED—played a particularly active role in contributing content expertise and perspective to the drafting process. Others in the I’M HOME Network played a critical role as advisors and supporters—informing both the drafting process and the final vote—by providing insight to I’M HOME staff and contacting their state commissioners to share their personal or organizational experiences.
The passage of the Act is just one step in a much larger (and longer) process to improve, simplify and streamline manufactured home titling statutes across the country. Achieving that goal will require state level advocacy efforts to introduce, support and enact new titling legislation in states where this Act would be an improvement on current statutes. It will also require even greater commitment and resolve from the I’M HOME Network—and hopefully, the broader affordable housing field—of lenders, homeowners, community organizers, advocates and developers. Though it will likely be several years before a real transformation in the market for manufactured home mortgage finance can be realized, the passage of the Uniform Manufactured Housing Act is a major step forward in the right direction.