Do you know around 22 million people in America live in mobile or manufactured homes? Among these, 56.4% of the population has lived in these homes for more than 10 years. The growing popularity of mobile homes has encouraged people to consider this cost-effective, flexible, and reliable alternative to traditional homes. The important question is, what happens when someone living in these homes passes away? Are these homes considered real estate property? In this post, we will discuss the probate process of mobile homes. Let’s get started.
Real or Personal Property: What Exactly is the Mobile Home?
To know what mobile homes are, we need to understand the difference between real and personal property. Real property is immovable, meaning the traditional houses are built from the ground up. Simply put, it is the land or any asset or building affixed to that. Personal property is movable.
In the case of mobile homes, they are considered real property only if the homebuyer owns the portion of the land where the mobile home stands. It should be permanently attached to that land and must be immovable to be considered real property. If the mobile home doesn’t meet these conditions, it falls into the personal property category and will be treated just like other movable assets in the probate process. This means their worth is calculated like any other personal property, i.e. after deducting any cost the property is accruing.
Getting a loan for a mobile home is comparatively difficult compared to traditional homes, especially if they are on rented land. That’s why before investing, seek an appraiser’s assistance. They might be able to tell you the property’s status (whether it’s real or personal property) and your financing options.
What About the Title?
Note that a mobile home can be a personal property, but it still has the title, which must be transferred when it’s bought or sold. The owners are issued a title when these homes are manufactured and bought. So, make sure you sign the title ownership paper when buying a mobile home. Usually, it’s done before closing.
It’s therefore important to check the will properly to see who the beneficiary is. If the deceased has clearly named the person who’d be the new owner of the mobile home after their demise, the title will be transferred immediately to the beneficiary. This saves the executor a great deal of time. If the deceased has not mentioned a beneficiary, the executor will deal with the mobile home either by selling it or transferring the title to the most deserving beneficiary.
Usually, executors try to settle mobile homes as fast as possible, since they tend to incur expenses. It’s possible that your mobile home will accumulate rent during the probate process, i.e. if it sits on the rented land.
Can You Convert Your Mobile Home From Personal to Real Property?
If you wish to transfer the property’s title from personal to real, you need to acquire the title certificate from the original owner. The title certificates for mobile homes are issued by the Department of Motor Vehicles. As mentioned earlier, they are treated as personal property and are thus seen as your other movable assets, like a vehicle.
De-Title Your Home With DMV
Once you have got the title certificate, head to the DMV and have your mobile home detitled. This will change its status from an asset to a structure. You can then list it as real property and acquire a new title for it. The next step is to record the affidavit at the county assessor’s office. This affidavit is proof that your home is affixed to the land that you own and will remain permanently attached to that. If you are having difficulty understanding the status conversion process, reach out to the title company for guidance.
Get a Licensed Engineer
You need to appoint a licensed and certified engineer who will assess your mobile home’s foundation and issue a foundation certificate. The certificate is issued when the engineer declares that the home is permanently attached to the land. They will see the foot of the structure to figure out if they are permanently tied to the ground and can’t be lifted. Another inspection might be needed to confirm the property’s status before its title is changed.
Conducting Title Search for a Mobile Home
Mobile homes are different from stick-built homes that are considered real property. The deed is used to transfer the ownership title from the previous homeowner to the current one. As mentioned above, the title of a mobile home is issued by the DMV. Some mobile homes may have two separate titles, one for the house itself and another for the land (if both have different owners).
It’s important to go through each record to determine if the title is free or if there’s a lien holder. Some things, like the unpaid utility bill or an unfinished repair on the mobile home, might not be in the public record. To check that, you need to conduct a municipal lien search. It’s a comprehensive report that shows the issues with the property that are not found in public records.
Check Liens
Likewise, you must check with the association that offers basic amenities to the mobile homeowner to know whether there is any outstanding payment from the previous homeowner. It’s advisable to have an escrow officer or a trusted title company during the closing. They will assist you in the title transfer process. Not only that, but a professional will check whether the property is listed as real or personal, the previous homeowners, any liens on the property, and other issues.
Conclusion
A mobile home can be a personal or real property depending on whether it’s affixed to the land or movable. It’s best to buy the land where your mobile home sits. Attaching it permanently to the land will help you change its title. Make sure you do the research to identify any lien holders before buying.
