Q. What is the difference between a Mobile home and a "regular" home?
A. A Mobile home is considered "Personal Property". The transfer of Title to the Mobile home is done through The Department of Housing. Nothing is recorded with the County to change ownership.
Q. Is there a way to make a Mobile home "Real Property"?
A. If you own the land that the Mobile home is located on, you may permanently affix the home to the land (with a County approved foundation system) and file a form 433A with the County. You may wish to contact the County directly for further information.
Q. What if the home is in a Mobile Home Park?
A. The land in the Mobile Home Park is not owned by the homeowner. They pay a monthly rental fee for the space, but the home would never be able to be affixed permanently. However, there are a few Mobile Home Parks out there where you do actually own the land within the park.
Q. How do you transfer Title when you own the land with a Mobile Home on it, but the Mobile Home is not permanently affixed?
A. Basically it is handled as two transactions within one escrow. The value of the land and the value of the Mobile Home have to be determined by the clients. A Grant Deed is recorded to transfer title to the land, while the Mobile Home transfer is handled through Department of Housing. Title insurance will be issued on the value of the land only.
Q. The Mobile Home is not permanently affixed to the property. Why do I have to pay County Property Taxes? Doesn't that make it "Real Property"?
A. All Mobile Homes manufactured after 1980, by law, are placed on the County Tax Rolls. Owners of Mobile Homes manufactured prior to 1980 also have the option to place their home on the County Tax Rolls, thus eliminating the need to pay Annual Registration Fees to Department of Housing. Once the Mobile Home is placed on the Tax rolls, it is there forever. You cannot remove it from the Tax Rolls and place it back with Department of Housing. By being on the Tax Rolls, it does not make it "Real Property". The taxes that you are paying are "Personal Property" taxes.
Q. Then why do we have to transfer the Title through Department of Housing if we are paying Property Tax?
A. All Mobile Homes whether or not they are on the tax rolls need to be registered with Department of Housing. Just like you would register a car with DMV when you purchase it.
Q. What fees would I have to pay if the Mobile Home is on the County tax rolls?
A. Escrow would request a Conditional Tax Clearance Certificate from the County Tax Collector's office. The County advises escrow how much to collect from the buyer for Prepaid taxes. The County typically collects a year's tax in escrow from the buyer. Due to the time that it takes for Department of Housing to transfer title and notify the County of the new buyer, the County wants to ensure that there won't be any delinquent taxes, therefore they collect upfront for one year.
Q. What if the Mobile Home is not on the County tax rolls?
A. We then have to obtain a Certificate of Retail Value from Department of Housing. This is basically the "Blue Book" value of the Mobile Home. The buyer would then have to pay sales tax based on either the purchase price OR the Retail Value, whichever is LESS. The sales tax is calculated using the tax rate for the County where the home is located. Keep in mind the Department of Housing only uses the make and model of the home to make the determination of value. Sometimes the sales price is quite a bit more than the value, but there are other things to consider, such as location, upgrades, etc.
Q. Is the sales tax the only fee we will have to pay to Department of Housing?
A. No. The sales tax is a one-time fee, however you will have to pay Annual Registration fees to Department of Housing. Typically the Annual Registration fee is less than $100.00 per year.
Q. What do I need to do if I want to place the home on the County tax rolls?
A. In escrow, we prepare the documentation to submit to Department of Housing that advises them that you wish to place the home on the County tax rolls. Once the transfer is complete with Department of Housing, they will contact the County who will then add your Mobile Home to the tax rolls. You can expect to receive something from the County between 6 months to 12 months after escrow closes. If you choose to place the home on the tax rolls, escrow does not collect anything up front. We cannot collect any prepaid taxes because it officially is not yet on the tax rolls, and you do not have to pay sales tax if you are converting to the tax rolls.
Q. The Certificate of Title shows that the Registered owners are shown vested with an "OR". Do both parties still need sign?
A. For escrow purposes, we always have all parties who are listed as Registered Owner sign all escrow documents and all Department of Housing documents. This eliminates any problems in the future and ensures that the transfer to the buyer will never be held in dispute.
Q. What if the Registered owner is deceased?
A. If the total amount of the estate is less than $100,000.00 then no probate is required in the State of California. We would then have all the heirs to the decedent's estate sign the escrow documents and the Department of Housing documents. If the estate is more than $100,000.00, then probate is required. The Court would have to appoint an Administrator of the Estate and as long as that Administrator was given full authority, then only the Administrator would have to sign. In all cases, a death certificate is required and if probated, copies of the Letters of Testamentary would also be required to submit to Department of Housing.
Q. What if the Registered owner is a Trustee of a Trust?
A. Department of Housing does not require a full copy of the Trust as long as the Trustee is living. If living, then the Trustee would sign as representative of the Trust. We would require the full name of the Trust and the Trustee would have to sign a Trust Certification, prepared by escrow. If deceased, then a copy of the Trust would need to be submitted to escrow to determine who the Successor Trustee is. Whoever the Successor Trustee is would be the one to sign all the documents.
Q. Why don't I get a Preliminary Title Report?
A. Preliminary Title Reports are issued in preparation of issuing Title Insurance. Since Mobile homes are Personal Property, there is no title insurance issued, therefore there is no Preliminary Title Report.
Q. How do we know who is on title? Are there any liens?
A. We obtain a Title Search (it's a one page document) from Department of Housing that will show who the Registered owner is and who the Legal owner is. We generally don't distribute a copy of the Title search at the beginning of the escrow, however if you would like a copy of it, feel free to contact us for one.
Q. What if there is a Legal Owner or Lienholder?
A. We would contact the Legal Owner for a payoff demand the same way we do for real property. Any liens listed on the Title search will need to be paid in escrow.
Q. Are there lender's out there who will loan on Mobile Homes?
A. There are very few lenders' that are lending on these types of homes. Feel free to call me at the number given and I can give you the names and numbers of the lenders that I know of.
Q. What about insurance? Which companies offer insurance for Mobile Homes?
A. We suggest that the buyer contact their current insurance carrier to see if they have coverage available for Mobile Homes. If their insurance carrier is unable to provide coverage, the buyer should call other carriers to check on insurability. We do have a few names of insurance companies that we can suggest also.
Q. What about FIRPTA? Does that apply?
A. FIRPTA only applies on real property. Since Mobile Homes are considered personal property, FIRPTA will not apply. At the close of escrow there is no 1099 issued by us to the seller. The seller should keep all closing documents to provide to their accountant/tax preparer for tax purposes.
Q. After escrow closes, how long will it take for the new buyer to receive the Certificate of Title from Department of Housing?
A. At the close of escrow, all documents will be submitted to Department of Housing along with the funds needed to complete the transfer. The time frame depends on how backlogged Department of Housing is or if they send it back to escrow for additional documentation or clarification. Typically the buyer should receive the original Title within 4-6 months, however sometimes they are completed within a couple of weeks, or 8-12 months. It just depends on the situation and Department of Housing. Feel free to contact me if a sufficient amount of time has passed and the buyer has not received the documents. I can check with Department of Housing to see what the status is.
Q. If the buyer doesn't have the Certificate of Title, does the seller still get their money?
A. All funds are disbursed at the close of escrow. Escrow instructions are signed by both buyer and seller to make sure they understand that the Certificate of Title will be provided to the buyer at a later date.
Q. What do I need to open escrow with Placer Title Company?
A. Below is a list of items/information to obtain prior to opening escrow:
•1. Decal number of mobile home (the client should have a copy of their current registration and or title which will show the decal number in the upper right hand corner. (if the client does not have either of those documents, the decal number is sometimes listed on the outside of the home or someplace in the home-usually in the laundry room) Unfortunately we cannot locate information with Department of Housing by name or address. The only way to do a title search is to have the Decal and/or Serial number of the home.
•2. In the event that the HUD number of the home is not listed on the title or registration, we will need you to physically go to the home and locate the number(this number would also be on the "license plate" outside of the home or in one of the inside closets. We will let you know if this number is needed.
•3. Names of all parties involved. Remember if the registered owner is deceased, ALL heirs will need to sign, so its nice to have all of their names and addresses handy to give to us.
•4. The seller should have the original Title ("pink slip") and Registration. The only time the seller should not have the title is if there is a loan on the home. We would then obtain the original title from the lienholder at the close of escrow. The title and registration should be submitted to escrow as soon as possible. In the event of cancellation, they would be returned to the seller.
•5. We also need to have the name of the mobilehome park. Escrow will not close until we receive park approval for the new buyer. It's always good to get your buyer into the park as soon as possible to make sure there are no gliches later on.
•6. How is the buyer going to take title? If they want to have the home in their trust, escrow needs to be advised as soon as possible in order to make sure all documents are drawn correctly. The buyer would need to provide us with the name of the Trust and their names as Trustees.