We have been talking about some of the basics of the manufactured housing program, and today I want to focus on one particular area of the Manufactured Home Procedural and Enforcement Regulations; Subpart F-Retailer and Distributor Responsibilites.
Before we dig into this discussion, it is important to note that with one exception, the requirements listed in Subpart F only apply to new manufactured homes to the first purchaser.
This subpart lays out three critical elements of the manufactured housing program:
- That a retailer may not sell or lease a new manufactured home that does not meet all applicable requirements of the HUD Code (24 CFR 3282.252).
- That the retailer must forward any and all information regarding the performance of the home to the manufacturer (24 CFR 3282.256).
- That the retailer must inform the manufacturer of the location of any manufactured home they sell, both new and relocated (or used) manufactured homes (24 CFR 3282.255).
Let’s break these down a little bit.
Everyone knows that a new manufactured home is pre-empt from state or local building codes. However, it is easy to forget that preemption is earned by assurance that new manufactured homes meet the federal building code. Without exception!
To put some teeth in the assurance that every new manufactured home meets the HUD Code, retailers are prohibited from selling or leasing a new manufactured home if a code related problem is observed. Unless a new manufactured home meets all applicable code requirements, it cannot even be offered for sale or lease! This prohibition of sale remains in effect until the problem has been corrected by the manufacturer, or the retailer when authorized by the manufacturer to make the repair or correction.
Now, a retailer is not expected to inspect every new home looking for problems, but rather have a basic understanding of the HUD Code and report any possible issues. I think it is a reasonable assumption that all manufactured home retailers have a copy of the Manufactured Home Construction & Safety Standards. If you don’t have a copy of the HUD Code CLICK HERE and print yourself a copy.
This prohibition of sale remains in effect until all goods and services agreed to in the sales contract with the purchaser have been delivered. If installation is included in the sale, then the home must meet the standards throughout the completion of the installation. If you are not providing installation, make sure you are fully disclosing the installation requirements to the purchaser prior to the sale! More on that in a future post.
In my opinion, the most important provision of the manufactured housing program is that retailers must tell the manufacturer of all possible failures to meet the HUD Code. There are no exceptions to this requirement. If you believe that a new manufactured home has a problem, you must report it to the manufacturer. If you get a consumer complaint that might be code related, you must report it to the manufacturer. If you receive information from any source that might suggest a problem with a new manufactured home that you sold, you need to tell the manufacturer. Without exception!
If the home is out of warranty, it doesn’t matter! Tell the manufacturer. Even if the service manager tells you to stop reporting, keep on reporting every possible code violation. Even if the issue concerns an appliance or fixture, the regulations require you to report the issue to the manufacturer and they can make a determination regarding any further action. And equally important, keep a record of everything you report!
Lastly, a retailer must inform the manufacturer where their homes are installed. Typically, this is done by submitting the purchaser card provided by the manufacturer. If you have ever seen these purchaser cards and wondered why there are three, it is because this requirement goes beyond new home sales, but applies to any relocated manufactured homes as well. The remaining cards are for subsequent sales and/or locations of the home.
If the cards are missing, retailers are still required to send the same information to the manufacturer that the card required, most importantly the serial number of the home and the location.
You never know when the manufacturer may have to take some sort of remedial action or notification to address a problem with a home they have produced. For more information on the purchaser card, check out 24 CFR 3282.255 and 3282.211. Click Here for these regulations
The only exception for this requirement is if the manufacturer is out of business.
That is a quick overview of Subpart F.
There are still other retailer requirements, such as retailer alterations (3282.254), consumer and dispute resolution disclosures (3282.7 & 3288.5) and proper handling of homes being stored and displayed. For more information on these issues, check out this post from November 2017, Four Things Every Retailer Must Know!
Keep in mind, this is my informal interpretation of these requirements and should never be confused as actual law or regulation.