A Few Basics of the Federal Program that Manufactured Home Professionals Should Know, Part 1

When I was in junior high school, we conducted an experiment to see how a particular statement could get twisted as it was passed along from person to person. After being whispered across the classroom, the information had very little resemblance to the original statement. We immediately learned not to trust everything that you hear.

I think the same thing happens in the manufactured housing industry. Often what we learn about the manufactured housing program gets passed down to us from our supervisors, colleagues, regulators and others. And just like that experiment in school, the facts often get twisted if not completely forgotten.

With this in mind, I think we should take a look at a few of the provisions in the manufactured housing law and regulations, that well intended professionals have a responsibility to know.

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One of the things I share in all of my training classes is that every new manufactured home MUST comply with all applicable standards; without exception! However, sometimes folks in our industry will enter into a contract or waiver with the consumer, attempting to create an exception to the program requirements (See Who Really Owns the Tires & Axles? for an example). If this is you, check out the following section of the Manufactured Housing Construction & Safety Standards Act.

§5421. Prohibition on waiver of rights.
The rights afforded manufactured home purchasers under this chapter may not be waived, and any provision of a contract or agreement entered into after August 22, 1974, to the contrary shall be void.

That seems pretty clear to me, a new manufactured home must fully meet the code and program requirements, without exception. Even if a consumer signs a waiver, the federal law renders that waiver void!

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A few times I have encountered folks attempting to create a loophole in the program by misconstruing the definition of “purchaser”. Their thinking is that they could buy a new manufactured home from a manufacturer or retailer, becoming the first purchaser and re-sell the home to the consumer, thereby ending the protections of the manufactured housing program to the consumer. Well, take a look at the definition of “Purchaser” in the Manufactured Home Procedural & Enforcement Regulation 24 CFR 3282.7(aa).

Purchaser means the first person purchasing a manufactured home in good faith for purposes other than resale.

If your purpose is to re-sell the home, you are not the purchaser.

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If you still say that you are in the “mobile home” business, as opposed to the “manufactured home” business, I’ll guess that you still wear leisure suits, listen to ABBA, and drive a Ford Pinto. There hasn’t been a “mobile home” produced since June 15, 1976. Except for modular homes (constructed to a state adopted building code), any single-family home built in a factory in the past 43 years is a “Manufactured Home”. Check out 24 CR 3282.8(a)

Using outdated or misleading terms to the purchaser can have unintended consequences. Better get with the times and use the correct terminology!

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Have you ever been told that a local building code official is not permitted inside a manufactured home? I have heard that claim for years, and it is not true! What the regulations actually say is that a building code official may not inspect a new manufactured home for compliance with the HUD Code. Basically, the code official should trust that the inspection process in the factory was sufficient (see 24 CFR 3282.11(b) of the regulations for more detail).

However, a code official entering the home is not a problem. I contend that a code official should enter every home to check the data plate information. And since the HUD Code doesn’t address certain construction standards that many other residential building codes require, the local code inspector is within his rights to look for items like carbon monoxide alarms, or baluster spacing (if the home has railings installed inside the home) to name a  few.

I have always advocated that every manufactured home professional should have their own copy of the Manufactured Home Construction & Safety Standards. Without a copy of the HUD code, you will never be able to determine if the code official has exceeded his local or state authority and started to tread on the federal program.

CLICK HERE to access the HUD Manufactured Housing web site to download a copy of the HUD as well as the federal law and regulations!

It might be a good idea to explore more of these type of issues in future posts. Please keep in mind, these posts are my personal opinion, and are not to be construed as anything more.

Who Really Owns the Tires & Axles?

I recently was called on to inspect a manufactured home installation located along the eastern shore of Virginia. While reviewing the mountain of documents provided to the homeowner from the retailer, one document in particular caught my eye. A one-page, single sentence document that simply stated:

“The tires and axles are property of (the name and address of the retailer) and will be removed after delivery”

Really? Are the tires and axles the property of the dealer?  Or do the belong to the purchaser? Is it okay for the dealer to just take them?

 

For me, the answer is pretty clear, although you might need some convincing. Let me share my thoughts and you can draw your own conclusions.

First look at the Manufactured Home Construction & Safety Standards (HUD Code) and see what is says about the tires and axles. We all know that a manufactured home by definition must be “transportable” and “built on a permanent chassis” (24 CFR 3280.2)  CLICK HERE to access the HUD Code.

While you are checking out the HUD Code, look at Subpart J “Transportation”. The general requirements at 24 CFR 3280.903(a) clearly state that the home must be designed to withstand the stresses of transportation for “its intended life”.

So, the HUD code requires a transportable home, not just to the initial location, but to future locations as well. But wait, there is more!

Look at 24 CFR 3280.902(a) that defines the term chassis.

“Chassis” means the entire transportation system comprising the following subsystems: drawbar and coupling mechanism, frame, running gear assembly and lights.  This same section tells us that the running gear assembly is a subsystem consisting of springs, axles, bearings, wheels, hubs, tires and brakes and their related hardware.

By now, I hope you can agree that the tires and axles are required by the building code, the Manufactured Home Construction & Safety Standards. Can a retailer write a statement into the sales contract and take them?

Look at retailer responsibilities that are outlined in the Manufactured Housing Procedural & Enforcement Regulations (24 CFR 3282.252). It states that a distributor or retailer is prohibited selling, leasing or offering for sale or lease a new manufactured home if he knows that it does not conform to any sections of the HUD Code. That would include the code sections that I referenced above. CLICK HERE to see these Regulations.

Ok…but what about having the homeowner sign an agreement, allowing you to remove the tires and axles? Let me make one final point. If you take a look at the federal law which is the basis for this entire program, there is one short section called “Prohibition of Waiver of Rights”. It states; “The rights afforded manufactured home purchasers…may not be waived and any provision of a contract or agreement entered into…to the contrary shall be void”. CLICK HERE and scroll to page 5657

So, what does all of this mean? To me it is simple. The tires and axles of a manufactured home are required by the code, and the purchaser has right to a manufactured home that meets all applicable aspects of the code. Any contracts to the contrary are void under the federal law.

Now I am not a lawyer, and as is the case with all of my posts, I am only sharing my opinions. I hope you find this information helpful in order to make informed decisions, and take steps to avoid any potential liability.

Your comments are invited!