- February 03, 2009
- All Wisconsin Issuing Offices
- Mobile/Manufactured Housing in Wisconsin
Why do you need a Manufactured Housing Endorsement (ALTA 7, 7.1 & 7.2)?
In the standard title policy (both owners and lenders) the definition of land includes only the actual land and any improvements affixed to the land which by law constitute real property. "Land" does not include improvements that are not affixed to the real estate. The ALTA Endorsement 7 (Manufactured Housing Unit); ALTA Endorsement 7.1 (Manufactured Housing Unit-Conversion; Loan); and ALTA Endorsement 7.2 (Manufactured Housing Unit-Conversion; Owner's), each provide, among other things, that the definition of "land" in the policy "includes the manufactured housing unit located on the land".
What does it do?
Where the ALTA 7.1 or 7.2 are issued, the owner's policy will also insure: (1) that the owner of the land owns the manufactured housing unit, (2) that the manufactured housing unit is on the land, (3) that the manufactured housing unit is real property, (4) that there are no personal property liens against the manufactured housing unit (unless excepted in Schedule B), and, and for lenders only, (5) that the lien of the insured mortgage attaches to the manufactured housing unit, and (6) that the lien of the Insured Mortgage can be foreclosed in a single foreclosure procedure against the manufactured housing unit and (remaining) land.
When can you issue it in Wisconsin?
Stewart Title Guaranty Company's guidelines for issuance of these endorsements are available at Stewart's Virtual Underwriter (http://www.vuwriter.com/http:/www.vuwriter.com). The following is limited to the state-specific portions of those guidelines. PLEASE NOTE that you must comply with ALL of the guidelines prior to issuing these endorsements.
Does the Mobile/Manufactured Home need a Certificate of Title?
Manufactured Homes and Mobile Homes are governed by Subchapter V of Chapter 101 of the Wisconsin Statutes (§§101.91 through 101-965). Please note that under the definitions in the statutes, both manufactured homes and mobile homes are referred to as Manufactured Housing Units.
Under these statutes, the issuance and cancellation of Certificates of Title for Mobile/Manufactured Homes is done by the Wisconsin Department of Commerce, Buildings and Safety Division if the mobile/manufactured home is greater than 40 feet in length (for homes built in 1975 and older, 45 feet). Mobile homes less than 40 feet in length are "registered" by the Wisconsin Department of Transportation, and are generally of a type that is not suitable to be affixed to real estate.
Verify Status of Certificate of Title (If any)
Determine whether the Wisconsin Department of Commerce (DOC) has issued a "Certificate of Title on the manufactured housing unit (MHU), and whether there are any liens filed against the MHU.
DOC Records: The Department of Commerce has electronic records that can be searched on its website (http://cl.exct.net/?ju=fe6113747d64027e7714&ls=fdf715787167027b7d147475&m=feee1078766d0d&l=fec111757367007a&s=fe5a1c74716c017c7610&jb=ffcf14&t=). The DOC is required to retain these records for five years after the last Certificate of Title is surrendered. To search these records, do the following:
- After opening the website, click on "Safety & Buildings" on the left-hand side of the website
- Click on "Manufactured/Mobile Homes"
- Click on "Search S&B Records"
- Choose "manufactured homes" from the drop-down list under "object type"
- Click on "go to detailed search"
- Enter search criteria - usually the name of the property owner and property county
- Review the list that is pulled up to determine whether a Certificate of Title has been issued for the MHU in question and, if so, whether there are any liens on that certificate.
If there is no Certificate of Title listed on the DOC website, that does not mean that the improvements are not a MHU, it just means that there is no current certificate issued. There are several exemptions from the requirement that an MHU have a Certificate of Title. For example, manufacturers of MHU's do not have to apply for a Certificate of Title where the MHU will be sold to a buyer who intends to immediately affix the MHU permanently to real estate. Therefore, if the improvements are or were manufactured housing, the owner of the MHU must still complete the Manufactured Housing Unit Affidavit and Indemnity, even if there is no current certificate issued.
If the DOC does show that there is a Certificate of Title, your commitment:
- must call for the existing owner of the MHU to assign that Certificate of Title to the proposed insured buyer;
- must require the buyer to write "surrendered" on the face of the Certificate of Title and deliver it to the title company for return to the DOC;
- must require the release of any liens disclosed on the Certificate of Title (See the Surrendering the Certificate section below).
Surrendering the Certificate of Title
For closing purposes, your closing department will need to be aware of the process for surrendering the Certificate of Title. According to the Department of Commerce, the process is as follows:
- The new owner needs to transfer title into their name by completing the Title Application Form 10687 and attaching the necessary title transfer document (this form and other needed forms can be found at the DOC website - http://www.commerce.state.wi.us/SB/SB-DivForms.html#manfhome) and sending it to the DOC with a transfer fee of $23.00.
- Once title is in the buyer's name, the buyer may include a letter asking the DOC to surrender the home to real property status, or merely write the words surrender across the face of the existing title submitted with the application. PLEASE NOTE that there is a new surrender fee of $40.00.
- If there are existing liens on the MHU at the time of transfer, those liens must be satisfied before the buyer can surrender the Certificate of Title, and proof of satisfaction should accompany the surrender request.
- The buyer must also include a copy of a property tax bill or other proof that the home is affixed to real estate with the surrender request.
- If the buyer needs to expedite the process, there is a additional fee of $15.00.
- The buyer will then receive a letter from the DOC that the mobile/manufactured home has been surrendered to real property status.
You must also determine whether there has been any Uniform Commercial Code filing that affects the Mobile/Manufactured housing unit. To do this, search the Wisconsin UCC filings with the Department of Financial Institutions (DFI) to determine whether any lienholder has placed a lien on either the manufacturer of the MHU (for new MHUs) or on the current owner of the MHU. This information can be obtained from the DFI's website ( http://www.wdfi.org).
Verify that the MHU has become a Fixture on Real Estate
You must also determine that the manufactured housing unit is no longer personal property under state law, but has become so permanently affixed to the land that the manufactured housing unit is an integral part of the land.
Check for the following:
- Check to see that the same party owns or will own both the land and the manufactured housing unit.
- If the manufactured housing unit has been affixed to the real estate prior to the closing, check to see if the manufactured housing unit is being taxed in conjunction with the land as a single parcel of real property.
- If the manufactured housing unit has been recently affixed (after January 1 of the current year), look for items evidence that the unit has been permanently affixed to the land, including: removal of axles/wheels; attached to a permanent foundation; permanent connection to water, sewer and other public utilities
Obtain an Affidavit and Indemnity from the owner:
Please note that there can be more than one "original" Certificate of Title" out there, as the Department of Commerce appears more than willing to issue duplicates. Further, it has not been unknown for an owner of an MHU to state that there is no certificate, or to surrender one certificate at closing, and then to go out and get financing secured by a duplicate certificate. Accordingly, the owner of an MHU must execute the attached Affidavit and Indemnity for Manufactured Housing Units at closing, and the commitment should call for the execution of this affidavit.
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