Joel What Do I Do? I Don’t Understand Everything About Mobile Home Transfers

One of the more complex and time-consuming issues we deal with as closing attorneys is when a purchase and sale agreement includes a mobile home (also known as a manufactured home). While there are instances when the transfer of a mobile home is treated like any other closing, there are times when numerous additional steps must be accomplished before we can close. This article will provide you with general information regarding the transfer of mobile homes in connection with closing and sets forth detailed information that you need to know as a Realtor when representing clients and a mobile home is involved with the transaction.

The information in this article does not apply to any home that qualifies as a modular home (sometimes referred to as a “residential industrialized building”). Modular homes are not issued titles and must contain an insignia of approval issued by the Georgia Department of Community Affairs.

The Basics:

Initially, mobile homes, like cars, are personal property (rather than real property such as land) and have state-issued titles. A mobile home title is a legal document that proves ownership of the home. When we discuss mobile home titles in this article it is different than when we refer to titles relating to real estate. Single-wide mobile homes will have one title and double-wide mobile homes generally have two. For double-wide mobile homes, each title will include the same vehicle identification number (VIN), but one will end in A and one will end in B.

When a mobile home is being transferred (and not in connection with a real estate closing), the titles are transferred by the buyer and seller signing the back of the titles to transfer the same. Then the buyer takes the mobile home title to the tax commissioner’s office (in the county where the mobile home will be placed) with a MV-1 Motor vehicle title application and the state will process the transfer and issue new mobile home titles in the buyer’s name. While that sounds super easy, and it is, the transfer of mobile home titles when connected to a real estate closing can get much more complicated.

While not required under VA, FHA, USDA or conventional loan financing, a majority of lenders will not close a loan in connection with a mobile home UNLESS the mobile home titles have been retired. What does that mean? “Retirement” means all original titles are surrendered to the county tax commissioner and a T-234 (also known as a Mobile-Manufactured Home Certificate of Permanent Placement) is recorded on the public record for each title issued for a specific mobile home. A mobile home is converted from personal property to real property once the retirement process is complete. Going forward, the property will only receive one property tax bill and not a separate mobile home bill. You may also hear this process known as the surrendering of titles.

Retirement of Mobile Home Titles:

Generally, mobile home titles can only be retired when the seller has the original mobile home titles in his or her possession. The following will discuss the process of retirement of mobile home titles after a contract has been provided to the closing attorney and it is determined that the lender will require the mobile home titles to be retired PRIOR to closing.

First, the seller will need to provide copies of the front and back of the titles to the closing attorney so that the closing attorney can prepare a T-234 for each mobile home title. A T-234 is the legal document recorded on the public record that converts a mobile home from personal property to real property. Once the T-234s are prepared, the seller must bring the original mobile home titles to the closing attorney and sign the T-234s.

Second, the closing attorney will e-record the signed T-234s in the real estate records.

PLEASE NOTE: Chatham County’s process for this step is different than most counties in the area. For mobile homes in Chatham County, the T-234s CANNOT be e-recorded and the seller MUST go to the Chatham County Superior Court Clerk’s office in Savannah to be recorded. *** See the last paragraph of this section.

Third, once recorded, the closing attorney will email a copy of the recorded T-234s to the seller. The seller must then take the recorded T-234s to the clerk of superior court real estate division in the subject county and have the clerk certify the copy.

Last, the seller must then go to the county tax commissioner’s office with the certified copy of the T-234s and the original mobile home titles to retire the titles. Once the tax commissioner has retired the titles, they should give the seller confirmation that the titles were retired. The confirmation is by a document called “Title Cancelled to Real Property” and the closing attorney will need a copy of the confirmation for their file.

*** Chatham County Title Retirement Process ***

The seller takes the signed T-234s and the original mobile home titles to the Chatham County Superior Court Clerk’s office in Savannah to be recorded. The clerk should let the seller wait while they record them. The seller should ask the clerk to give them a certified copy of both T-234s. Then, the seller takes the certified copies of the recorded T-234s and the mobile home titles to the Chatham County Tax Commissioner’s office to surrender the titles. If the Tax Commissioner needs to keep the certified copies of the T-234s, please have the seller obtain the deed book and page number for each so the seller can email that information to the closing attorney. Once the Tax Commissioner has retired the titles, the seller should obtain confirmation that the titles were retired. The confirmation is by a document called “Title Cancelled to Real Property” and the closing attorney will need a copy of the confirmation for the file.

Mobile Home Titles and Closings:

Cash Closing: Assuming the mobile home titles have not been retired, the seller should send copies of the front and back of the mobile home titles to the closing attorney so the attorney can confirm (a) the owner of the mobile home matches the owner of the real property being sold, (b) that there are no lien holders listed on the titles and (c) that there are no signatures on the back of the mobile home titles. Assuming everything is in order, the seller will bring the original mobile home titles to closing and the buyer and seller will sign the back of the titles to transfer the same. Then the buyer will take the mobile home title to the tax commissioner’s office (in the county where the land and mobile home are located) with an MV-1 Motor vehicle title application. Then, the state will process the transfer and issue new mobile home titles in the buyer’s name.

SUPER IMPORTANT: There are instances, even in a cash transaction, where the seller will need to retire the mobile home titles prior to closing. This will be required when a buyer cannot transfer the mobile home titles into his or her name. A few common examples where this scenario will occur are when the buyer is not a US citizen or in certain counties, the buyer does not have a Georgia driver’s license. The closing attorney should be monitoring this situation to be able to provide guidance to the parties if the mobile home titles need to be retired in a cash closing.

Financed Closing:

If a lender requires that the mobile home titles be retired prior to closing, the steps are set forth above. If the seller has a mortgage associated with the mobile home titles, and the buyer’s lender will allow for the mobile homes titles to be retired in connection (but after) closing, the closing attorney will confirm with the seller’s lender that it does in fact have the original titles in its possession. The closing attorney will then conduct the closing like any other, but will have both the buyer and seller sign a mobile home- specific power of attorney so that the closing attorney can complete the retirement process post-closing. Once the seller’s mortgage has been paid in full, the seller’s lender will release the mobile home titles. In a perfect world, the mobile home titles are then sent from the State to the closing attorney and the closing attorney uses the power of attorneys to complete the retirement process.

Listing Agent Tips:

Prior to any listing appointment involving a mobile home, the first question to ask the seller is whether he or she has the original mobile home titles in his or her possession. If they do, that is great news as the titles should not show any lienholder on the titles and it’s the equivalent of someone who owns any real property free and clear without any debt associated with it. You should also make sure that the name(s) listed on the mobile home titles match the name(s) shown on the most recent deed into the seller(s).

If they do not have the original titles, it means one of four things:

1. They have a loan associated with the land and mobile home and the lender has the original mobile home titles. If your client determines that the lender has the original mobile home titles, there is nothing more to do as the lender will not release the titles to the owner of the mobile home until the loan is paid in full. As you know, that will not happen until the property is sold and the lender is paid off.
2. There is no loan associated with the mobile homes title, but the seller has lost the original mobile home titles or they never received them after closing (but knows the mobile home titles were transferred into their name). If the seller has no mortgage associated with the mobile home titles, the titles have not been retired, and they cannot locate the originals, your client should request replacement titles at the county tax commissioner’s office. It usually takes two to four weeks for the new titles to be mailed to your client.
3. The mobile home titles were never transferred into the seller’s name. If your client determines that the mobile home titles were never transferred into their name, your client will need to obtain a bond for title. This situation likely occurs if the seller bought the mobile home without the seller receiving any mobile home titles in connection with closing. After the closing attorney confirms that there are no recorded T-234s from a prior owner, the seller will need to apply for a title bond in order to obtain new titles in their name. A bond for title is obtained through certain, local insurance companies. Once the bond is completed, the seller should then be able to apply for new titles in their name.
4. The titles have been retired. If your client informs you that the mobile home titles have been retired, again there is nothing more for you to do and you will treat this transaction like any other home closing (but I would check with the last closing attorney to confirm the titles have in fact been properly retired).

If your client is not sure about the status of their mobile home titles, the easiest way to obtain information about them is to find out who the last closing attorney was and ask them to let you know.

Selling Agent Tip:

1. As mentioned above, a majority of lenders will require the mobile home titles be retired prior to closing. If you are working with a buyer looking to purchase a mobile home, you should reach out to the lender they are working with to determine whether that particular lender will require the titles to be retired prior to closing or will allow them to be retired after closing. The reason why that is important is because then you will know what scenarios your client can purchase a mobile home under. For example, if the lender will require the titles to be retired prior to closing, then there is no point in putting in an offer on a mobile home that is financed (assuming the titles have not already been retired) because you end up in a situation where the buyer’s lender cannot close until the titles have been retired and the seller’s lender will not release the mobile home titles to be retired until after the closing has occurred.
2. You must include both the real property and the mobile home in the purchase and sale agreement. Include a special stipulation that there is a mobile home included in the transaction. This will ensure when the closing attorney is conducting a title examination, he or she is aware that a mobile home is also a part of the closing.

Additional Consideration:

If the buyer or seller plans to tear down or move the mobile home as part of the transaction, they must contact the county tax assessor’s office and advise them of their plans for the mobile home. If this step is missed and the mobile home is removed, the mobile home will continue to be connected to the property and the tax commissioner will continue to tax the mobile home with the land.

As always, if you need help with anything please call us on our cell numbers anytime (even nights and weekends and even if the closing is not in our office). Joel at 912-484-1996 or email him at jgerber@brannenlaw.com. Bailey at 678-988-0206 or email her at bedwards@brannenlaw.com.