Mobile Homes
If you have ever had a listing for a mobile home in a mobile home park, you already know these transactions do not follow the same playbook as a traditional residential closing. The process, the paperwork, and even the way the “title” transfers are all different, and working with a closing team that understands those differences can save your seller (and you) a lot of headaches.
At Chicago Title of Colorado, our closing team handles mobile home transactions regularly, and they are well versed in every detail that makes these files unique.
Escrow-Only Transactions
Unlike a traditional home sale, mobile homes in parks do not involve title insurance. These are escrow-only closings, which means Chicago Title handles the settlement and coordinates the funds, but there is no title search or title insurance policy issued. The settlement fee is $1,200.
The Title Works Like a Car Title
This is probably the biggest difference, and it catches people off guard the first time. A mobile home that has not been purged (meaning it has not been permanently affixed to real property) is considered personal property, not real estate. That means the title is a physical document, similar to a vehicle title, and it gets transferred through the DMV.
If the seller owns the home free and clear, they will need to bring the original title to closing. If there is an existing loan on the home, the lender will release the title once the payoff is received, which typically takes about three weeks. After that, the buyer must go to the DMV in person and bring certain forms to complete the transfer.
Tax Authentication
The seller is responsible for obtaining a Tax Authentication form from the county before closing. This document confirms the tax status of the mobile home.
How this works depends on the county. In Arapahoe County, taxes are not pro-rated because they are included on the Tax Authentication itself. In El Paso, Larimer, and Douglas counties, the Tax Certificate serves as the authentication document. Our closing team will guide the seller through this process, but it helps to set the expectation early in the listing that this paperwork will be needed.
Financing
There are three main lenders that finance mobile homes in parks: Triad Financial Services, 21st Mortgage, and ANB Bank. Triad and 21st Mortgage fund more like a refinance than a traditional purchase, with a funding window of up to 72 business hours. ANB Bank is the exception, as they send a representative to the closing table and fund same day. Those timelines are important to communicate so no one is caught off guard at the closing table.
Simplified Monthly Costs
One of the benefits of mobile home park living is the simplicity. Most parks include water, trash, and other services in the monthly Lot Lease, so there are typically no separate HOA fees or utility transfers to coordinate at closing. That is one less thing on your plate as the listing agent.
1099 Exemption
Mobile home transactions in parks are exempt from 1099 reporting requirements. This is a small but important detail that our closing team will handle, but it is worth knowing as you walk your seller through what to expect.
Have a Mobile Home Listing Coming Up?
Whether you have a mobile home listing on the way or you just want to understand the process better before one lands in your lap, I would love to chat. I will connect you with our closing team, and we will take great care of your transaction from start to finish.