The Inclusive Economy
This Law Could Put Thousands of Dollars Back in the Pockets of Wyoming Manufactured Home Owners
By Mikah Zaslow on 03/14/2017 @ 12:00 PM
When Wyoming resident Jason Halvorson sought to refinance his manufactured home, he didn’t know he was embarking on a nine-month endeavor that would lead to changing state law. But, as Wyoming Public Radio reports, that’s what it took for the homeowner to avoid getting gouged and spending an extra $50,000 on his mortgage.
The problem? A law that made it impossible for many manufactured home owners to get the titling paperwork they need for fair financing.
Halvorson wanted to refinance his home after making upgrades, but he learned that the traditional method of going to a banker would not work as he did not have the Manufacture’s Statement of Origin for his home—and a duplicate could not be issued by the county clerk. While financing is available without this paperwork, the options have higher unfixed rates and are out of reach to many homeowners. Halvorson reached out to his coworker State Rep. Tyler Lindholm about the issue, who looked into the matter and was struck by the legal inequality of the state’s titling law. And earlier this month, their efforts resulted in Governor Matt Meade changing Wyoming’s titling law.
CFED’s Doug Ryan, who was interviewed for the story, brought up the lack of consistency in the way states handle titling laws. While New Hampshire, Vermont and Oregon have favorable titling laws, most are somewhere in between. According to Ryan, Wyoming’s house bill is an important example for other states, and that because manufactured housing represents an affordable means of homeownership, “states need to be more creative and more aggressive in making sure these homes are part of the housing system.”
Halvorsen said that other manufactured home owners can benefit from these changes as well if they are willing to dig in to the law. Our new resource guide, Titling Reform: How States can Encourage GSE Investment in Manufactured Homes reviews current state titling laws and can be used to aid in efforts to improve states’ manufactured home titling laws. Titling manufactured homes as real property is also important for the eligibility for the Duty to Serve rule, which details how Fannie Mae and Freddie Mac must serve the manufactured home market. However, outside of a proposed chattel property pilot, manufactured homes must be titled as real property to be eligible for credit under the rule.
States that want to reform their laws don’t have to start from scratch, though. In 2012, the Uniform Law Commission approved a model law—the Uniform Manufactured Housing Act (UMHA). If enacted, UMHA would resolve the many deficiencies and ambiguities in the existing state titling laws and greatly increase the number of homes eligible for financing that satisfies the new Duty to Serve requirements. A clear statutory titling procedure also has the potential to open up new markets for real property lending, offering lenders new lines of business and borrowers better options.
Titling manufactured housing as real property creates financial opportunities and serves to create greater equality among homeowners. The work of advocates like Halvorson is critical to ensuring that manufactured home residents have the same opportunities to access affordable financial products as owners of site-built homes.