What are the laws on mobile home repossession?

Answer 1

The law related to manufactured (mobile) home repossession varies greatly from state to state, and is typically pretty complicated. There are two types of loans that can finance manufactured homes. If the loan if financing a home on land that is owned by the homeowner the home is generally considered either real estate or an improvement to real property and can be financed by a mortgage, entitling the debtor to bother better financing terms and the protections of the full foreclosure process.

Many homes are on rented land in land lease communities, usually known as parks. The financing is typically a personal property loan, otherwise known as a chattel loan. The repossession process, although varied, always starts with a default on the loan. Generally, due to the low recovery rate on value of repossessed homes, the lender wants to come up with a way to keep people in the home. However, lenders are also concerned that the home value will depreciate, and so will move though the repossession process rapidly.

The typical process requires some form of notice of default and a period of time within which the homeowner can become current on the loan. The length of time varies from state to state, but is typically between 20 and 30 days. After the end of the notice period, the states diverge a bit. Some states the lender can repossess the home with no further notice or court action. Other state go though a process that is becoming much more prevalent in manufactured home repossession called replevin. They have to get a court order to gain possession of the home. Some states have additional reinstatement or redemption rights even after the court action is initiated. For instance, California allows redemption of the loan for 15 days after the court action starts.

Your best bet for finding the most accurate information is to check the state law where you live. Every state has a different process and even something that is typical in most states may not apply in your state.