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When a real estate closing involves a mobile home, the stress level of the closing attorney seems to ratchet up just a bit. Our Title Attorneys field many questions about underwriting mobile homes, and, although the answers we give are simple on their face, the practical aspect of carrying out the “simple” answer can be difficult and time consuming. So back up the truck and let’s hook up to the is-sues that involve mobile homes.

First things first: How do you even know that there is a mobile home on the property? You could send questionnaires to the realtors/sellers/buyers that ask for certain information, such as, “is there a mobile home on the property?” Also, you may find this information indicated on the appraisal, tax records, language in a prior deed or deed of trust, or the lender may request an ALTA 7 endorsement. This endorsement basically says that the term “Land” includes the manufactured housing unit located on the land described in the policy. So now we know we have a mobile home to deal with. What next?

Pretend there are two separate, three acre tracts of land at the end of a long and winding road. On one tract you have a 2003 singlewide mobile home on a brick foundation. The wheels, axels, and tongue have been removed.

The yard is beautifully landscaped and there is an underground pool in the back yard.

On the three acre tract across the road you have a doublewide mobile home on blocks. The wheels, axels and tongue have not been removed.

Which of these homes is part of the real property? Maybe the singlewide.

NCGS 143-143.9(6) defines a manufactured home as “a structure, transportable in one or more sections, which in traveling mode, is eight feet or more in width or is 40 feet or more in length, or when erected on site, is 320 or more square feet, and which is built on a

permanent chassis and designed to be used as a dwelling with or without a permanent foundation when connected to the required utilities, and includes the plumbing, heating, air conditioning and electrical systems contained therein.”

Under the definition above, both of our homes are manufactured or mobile homes. The question then becomes, how do they become part of the real property so that a deed conveys the land and home and a deed of trust encumbers the land and home? There are two issues that must be addressed: affixation and status of the title.

The first issue to consider is whether the mobile home is permanently affixed to the real property. In the examples above, the singlewide is permanently affixed. This is defined

What’s More Important: The Title of this Article or the Title to the Mobile Home? By Marc Garren, Esq. mgarren@invtitle.com

“How do you even know if there is a mobile home on the property?”

P1 October 2011

In This Issue: What’s More Important...

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NC Fun Facts 2 Claims Corner: Don’t Let Claims Spook You

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Meet Our Claims Counsel 4 Investors Trust Company: In re Reeder

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in NCGS 105-273(13) where a manufactured home is considered real property when it is:

1. A residential structure;

2. It has the moving hitch, wheels, and axels removed; and

3. It is placed upon a permanent foundation either on land owned by the owner of the manufactured home or on land in which the owner of the manufactured home has, what amounts to, a leasehold interest of at least 20 years.

NCGS 105-273(13), however, must be reconciled with two other statutes. Which one do we use, 47-20.7 Declaration of intent to affix manufactured home; transfer of real property with manufactured home attached, or 20-109.2 Surrender of title to manufacture home?

(Continued on page 2)

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It depends on our second issue and the answer to the most important question when a mobile home is involved: Where is the title???

Let’s use a base hypothetical and apply different facts to help us understand the issue when dealing with a mobile home. Client comes into your office and says that she is buying a property out of foreclosure. There is a mobile home on the property that is permanently affixed to the land. The first question that we ask would be: where is the title? Typically the answer in this scenario would be, “I don’t know.” After some research, you find out that the mobile home is the 2003 single-wide that we discussed previously. The realtor goes out to the home and finds the VIN # and/or serial # inside the breaker box or stamped on the frame. (As an aside, oftentimes, a homeowner’s insurance policy will have the VIN # and serial # on the policy). Once you have these identification numbers, you can call DMV and have them search those numbers and all the owners names back to the year the mobile home was built, in this case 2003. If the DMV says there is no record of an outstanding title, then you can have the owner sign a Declaration of Intent to Affix, as described in NCGS 47-20.7,

What’s More Important... (cont. from page 1)

address any liens on the title. Once the liens, if any, have been taken care of, look to NCGS 20-109.2 Surrender of title to manufactured home. Section (a), Surrender of Title, states if a title has been issued and the manufactured home qualifies as real property as defined in NCGS 105-273(13), the owner shall submit an affidavit to DMV and surrender the certificate of title to the DMV. This affidavit is the MVR-46G. DMV will cancel the title, sign the MVR-46G, and return the affidavit to you. You can then record the affidavit and the mobile home has magically become real property.

Obviously, I have not addressed every fact pattern that can occur regarding a mobile home. What about modular homes that are built on a steel chassis? What if there is a lien on the title and the lender is no longer in business? There are many difficult issues that

can arise when dealing with mobile homes. We are always eager to answer any questions that you may encounter along the way; however, remember the two basic questions that we must be able to answer: is the mobile home affixed to the

real property; and where is the title? Once these two questions are addressed, we can then determine what direction to take.

and then record this document. Since the mobile home has been affixed to the real property, no title is outstanding, and the Declaration of Intent has been recorded, the mobile home has legally become part of the real estate.

What if DMV finds that there is an outstanding title in the names of Mr. and Mrs. Woodard? We would need to have Mr. and Mrs. Woodard sign the title over to the lender or your client, the buyer. The

problem is that Mr. and Mrs. Woodard were the foreclosed parties and will probably not be very cooperative. Wait a minute! The bank foreclosed and took back the mobile home right? Wrong. The mobile home was not real property and a foreclosure action only involves the real property. A mobile home must be repossessed pursuant to North Carolina law.

So the outstanding title must be addressed. Maybe Mr. and Mrs. Woodard would be willing to sign over the title for a small fee, if you can find them.

Let’s say we found Mr. and Mrs. Woodard and they agreed to sign over the title and you now hold the title in your hand. What next? You must

“The first question we ask would be:

where is the title?”

P2 October 2011

“We are always eager to answer

questions you may encounter along

the way...”

Did you know that NC has many haunted attractions for those “not-so-faint-of-heart” Halloween thrill seekers?

The Kersey Valley Spooky Woods in High Point NC is one of those attractions and was featured on the Weather Channel’s Top 10 “Halloween Screams” for 2011! On-site activities include a House of Darkness, Prison Break, Fright Lights (a laser light show), Spooky Woods, and Military Zombie Shoot-Out.

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P3 October 2011

Don’t Let Claims Spook YouOver the last several years, we’ve been providing practical information on title insurance claims including procedural directions and tips for avoiding claims. See below for a listing of previous articles and a link to each.

The Title Insurer’s Options

Whoa! Slow Down—Many Claims are Preventable

But My Lender Said I Didn’t Need a Survey

Prove It (Foreclosures)

A Rocky Ending with a Fresh Start (Liens and Entirety Property)

Is the Security Interest Secured (Part I & Part II)

Details and Bankruptcy (Part I & Part II)

Cut the Cards (Part I & Part II)

The Importance of Timely Notice

Builder/Developer Claims

Accurate HUD Statements

Sharks in the Water

Access

Owner Claim Examples

Correction of Errors

Follow Your Orders—Builder/Developer Sales Free and Clear

Know Your Policy Options

Claims Procedures

Understanding the Policy Jacket

When? November 16th from 11am—2pm.

Where? Investors Title Company’s Corporate Office (121 N. Columbia St, Chapel Hill, NC 27514)

Space is limited—sign up now: www.mysignup.com/investorstitle

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P4 October 2011

physically separated, but not divorced. Ervin’s widow therefore sought her elective share, but the estate’s Executor (the couple’s son) objected, relying on the 2002 Agreement that specifically waived any “claim, interest, estate or title” in each other’s property “in the event of separation, dissolution of marriage or divorce.” The Court Clerk, who has jurisdiction of these issues, concluded that Mrs. Reeder had not waived her rights. The Clerk then issued an order granting Mrs. Reeder her elective share. The Alamance County Superior Court agreed with the Clerk, and entered a summary judgment to that effect. The Executor appealed, and the appellate court reversed. In reaching its decision, the Court of Appeals concluded that the Clerk had apparently interpreted the 2002 Agreement as requiring a “legal separation.” That interpretation, said the appellate court, was erroneous: the Agreement did not specify that the parties be legally recognized as separated, and thus, “the ultimate issue before the Clerk was the extent, if any, to which…[the parties] were physically separated [with] no intention of resuming the marital relationship.” Since the Clerk did not resolve that issue, the appellate court reversed, and remanded the case for additional proceedings.

--In re Reeder, No. COA10-618, N.C. Ct. App. 8/2/11

The above article is for information purposes only and does not constitute legal advice.

For more information, contact Ben Foreman at 877.327.9110 or bforeman@invtrust.com

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Whether a spouse has agreed to waive an elective share can only be determined by the specific language of any agreement the parties executed. That principle became critical when the North Carolina Court of Appeals had to decide if Constance Reeder had waived her right to claim an elective share after the death of her husband, Ervin Reeder, in April 2009. The couple was originally married in 1941, but then separated. They married a second time, but even after their second marriage, the appellate court said, “the couple continued to experience marital discord.” Those disagreements apparently led them to sign an “Agreement Regarding Status of Property” in 2002, while they were residents of the State of Washington. In 2006, they sold their home, and Mrs. Reeder began living in Montana with the couple’s daughter, while her husband moved to North Carolina, to live with their son. When Ervin died, the couple was still

© 2011 Investors Title Company. All Rights Reserved.

Carol Hayden, Claims Counsel Email: chayden@invtitle.com

Carol grew up in Raleigh, North Carolina. She received a music degree from Temple University, and her Juris Doctor from North Carolina Central University. She spent ten years living overseas with her husband and four children, teaching at foreign universities. She has worked in the title insurance industry since 1993, specializing in like-kind exchange transactions, and joined Investors Title in 1997. Carol has contributed to North Carolina Lawyers Weekly, has conducted numerous seminars for attorneys, realtors, and CPAs, and is

a member of the tax and real property sections of the North Carolina Bar Association and American Bar Association. She is also a member of the Federation of Exchange Accommodators (FEA), Triangle Commercial Real Estate Women, International Council of Shopping Centers, Urban Land Institute, and serves on the Advisory Board for the Meredith College Paralegal Program.

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