Problems Refinancing a Mobile Home Loan

by Lisa S. in Cahokia, Illinois

Ask Kate for help refinancing a mobile home loan: Lisa is in the middle of her refinance. She's just found out there is no record of the original title to her mobile home, now on a permanent foundation. In fact, it probably went missing during the transfer of her mortgage when her bankrupt lender was purchased. But now Lisa wants to know what she can do to complete her refinance.

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Lisa asks Kate about problems with refinancing a mobile home loan

Hi Kate,

We recently went to refi with our current mortgage company.

Problems Refinancing a Mobile Home Loan
After 2 or more months, when were almost ready to close, I was informed that the title to our manufactured home vanished.

It happened when my current mortgage company took over for the original (bankrupt) mortgage company.

My mortgage company says in Illinois we can't refinance or sell our home without it. But it can't be found.

We have never seen a title after we put the home on our property on a permanent foundation. We combined the home with our property we thought.

Is this truly the law? Or is that just a requirement with our mortgage company? Could we get someone else to refi our mortgage?

Kate Answers: Problems Refinancing a Mobile Home Loan

***zz-portrait-left.shtml*** Dear Lisa,

Before a mobile home is affixed to land that's already owned or being purchased, it is classified as personal property.

In the process of converting it to real estate, the Certificate of Title is surrendered to the Department of Motor Vehicles (DMV) or your state's proper governing body.

Although too late for you, anyone else reading this should make a copy of the Certificate of Title to keep in their permanent records before its surrender.

Differentiating Between Real Estate and Personal Property

If you aren't sure that you've gone through this process, here's one way to know if your mobile home was turned into real estate. Do you pay real estate property taxes to the county vs DMV or some other type of personal property fees?

If you still don't know, I'd check with a local title company. Ask for a property profile (generally no charge) that corresponds to your property address. See if there is any record of the transaction around the time you remember adding the home to the permanent foundation.

Look for taxes on an assessed improvement (the actual house) in the title records. If you don't see that, verify at least that you are paying taxes on the land.

If this sounds too confusing, don't give up! Personally ask the title company for help. They may respond to you more favorably than to your mortgage company, assuming the lender also called for clarification.

Mobile Home Tags and the DMV

Secondly, see if two metal tags (often called HUD tags) are still affixed to an exterior corner of the home. Sometimes they are found inside the electrical panel box. Search carefully because tags are small, approximately 2 x 4 inches.

When you can locate the tags, copy down the numbers. If you have a digital camera handy, take a quick picture too. Then make a trip to the DMV (or your state's governing body) and ask them to search for the surrender of the Certificate of Title.

Titles Obtained by Bond, Illinois Secretary of State Solution

Hopefully by now you have enough data for the mortgage company to continue the refinance. If you are still having trouble, your Illinois Secretary of State addresses lost title certificates for mobile homes, albeit a somewhat tedious procedure.

Do a search on the Illinois official website, cyberdriveillinois.com, for 'Titles Obtained by Bond'.

Summarizing the needed items...

  1. Evidence of the purchase, bill of sale, for example, or a notarized statement attesting to the purchase of the mobile home.
  2. Written appraisal.
  3. Surety or cash bond.
  4. Application form and fee to the Secretary of State.
  5. Illinois Department of Revenue form and possible tax.
Don't hesitate to call the state authorities for more information. Call the Secretary of State at 217-782-9796 about the Certificate of Title by Bond and the Illinois Department of Revenue at 217-785-6606 on the tax.

Chain of Title and Title Insurance

It is the norm for most types of mortgage transactions to call for a chain of title, aka the succession of title ownership to real property, as well as title insurance. But is this demand from your lender also an Illinois state law? I don't know. I suggest asking the Secretary of State when you call for more information.

But before you call, find out what lender-required title insurance does for you as a homeowner. In fact, I always say that title insurance companies are part of your Dream Team!

Good luck and best wishes,

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