Manufactured home

Key Takeaways

• A manufactured home is built in a factory on a permanent chassis and towed to the site, and HUD's standards require at least 320 square feet of living space.
• Every transportable section built after June 15, 1976 carries a HUD certification label showing it meets the federal Manufactured Home Construction and Safety Standards in 24 CFR Part 3280.
• In Washington a manufactured home is not real property in any form, including under fixture law, unless the title has been eliminated under chapter 65.20 RCW.
• A homeowner may apply to eliminate the title only when the home is affixed to land the homeowner owns (RCW 65.20.040).

What It Means

A manufactured home is a dwelling built almost entirely inside a factory, set on a permanent steel chassis, and towed to the lot where it will be lived in. HUD writes the construction rules. The federal standard calls for at least 320 square feet of living space and a chassis that keeps the unit transportable both at first delivery and later on. Every transportable section built in the United States after June 15, 1976 carries a certification label, often called a HUD tag, showing the section was built to the Manufactured Home Construction and Safety Standards in 24 CFR Part 3280.

The vocabulary matters on an exam. Units built before that 1976 date are properly called mobile homes, and they were not built to the federal code. A modular home is a third category. It is also prefabricated, but it arrives in sections that are assembled on a foundation at the site rather than rolling in on a chassis.

That chassis is what drives the legal treatment. Because the unit can be moved, it starts life the way a vehicle does, as Personal Property with its own certificate of title, and it stays that way until a state process converts it.

How It Works in Washington

Washington settles the personal property question by statute, and the answer is blunt. RCW 65.20.030 says a manufactured home shall not be real property in any form, including fixture law, unless the title is eliminated under chapter 65.20 RCW. Setting the home on a permanent foundation, pouring a slab, and hooking up the utilities do not convert it. Until the title is gone, ownership runs through the vehicle title system rather than the Real Property records.

Title elimination is an application to the Department of Licensing. Under RCW 65.20.040 the homeowner must own the land the home is affixed to, and must submit the certificate of title, an affidavit of ownership, local government certification that the home is affixed, and proof that taxes are paid. Once the title is eliminated, RCW 65.20.030 says a separate security interest in the home no longer exists. From that point the home is secured only as part of the real property, through a mortgage, Deed Of Trust, lease, or real estate contract. That is why a lender financing a manufactured home with a deed of trust needs the title eliminated before closing. Without elimination there is no real property interest in the home for the lien to attach to.

Example

Ted Brannigan owns two acres outside Yelm and buys a 1,680 square foot manufactured home for $148,000. The dealer delivers it in two sections, a contractor sets it on a permanent foundation, and Thurston County signs off on the installation. Ted assumes he now owns a single piece of real estate worth roughly $420,000, and he asks his credit union for a $118,000 loan against it.

The credit union stops him. Under RCW 65.20.030 the home is still personal property with its own certificate of title, so a deed of trust recorded against the land would not reach the house sitting on it. Ted applies to the Department of Licensing under RCW 65.20.040 and sends in the certificate of title, an affidavit that he owns the land, the county's certification that the home is affixed, and proof his taxes are current. When the title is eliminated the home merges into the land. His $118,000 loan is then secured by one deed of trust covering both, and when he sells, the buyer takes the home through the deed instead of a separate title transfer.

Common Mistakes and Exam Traps

• A manufactured home does not become real property just because it sits on a permanent foundation. RCW 65.20.030 says fixture law does not convert it, and only title elimination does.
• Mobile home and manufactured home are not interchangeable. Manufactured homes are the units built to HUD's federal code after June 15, 1976.
• Manufactured and modular are different products. A modular home is assembled on site in sections and has no permanent chassis.
• A home on a rented space in a manufactured home community cannot have its title eliminated, because RCW 65.20.040 requires the home to be affixed to land the homeowner owns.