Manufactured Housing Regulations Provide Solid Consumer and Investor Protection

A near vertical aerial abstract of a mobile home park.

Manufactured housing units (MHUs) play a vital role in providing private-sector affordable housing—an imperative part of the solution to the nation’s affordable housing crisis. But affordable does not and should not equal substandard quality. If anything, affordable housing stock should be built to the highest possible standard. Why? Low-income residents often do not have the financial wherewithal to complete repairs resulting from faulty construction, nor pursue damages through the courts; insurance is often minimal or non-existent.

As a nonprofit organization, we provide annual assessments on the performance of quality assurance systems implemented by Design Approval Primary Inspection Agencies (DAPIAs), In-Plant Inspection Agencies (IPIAs), and State Administrative Agencies (SAAs). On behalf of HUD, IBTS ensures that the quality systems used by these monitoring agencies are compliant with the Federal Manufactured Home Construction Safety Standards and Regulations.

IBTS is also responsible for the compilation, reporting, and maintenance of certification label usage and records, including label verification letters and data plate/compliance certificates.

Given this experience, we understand—perhaps better than anyone—why strong consumer protection regulations need to exist and be enforced in the manufactured housing segment.

Federal regulations level the playing field for manufacturers and consumers by eliminating geographic and regional variances. Manufactured homes are, by definition, transportable, while site-built homes are not. Site-built homes need only conform to local codes and regulations, but manufactured homes can cross county and state lines (some even international borders) between manufacture and installation. Local codes still apply at the point of installation, but if there is a variance between local code and HUD’s National Manufactured Housing Construction and Safety Standards Act, the federal regulations rule.

These regulations are not intended to over-burden manufacturers—indeed, they help streamline manufacturing by having each model meet the same standards regardless of where the home will end up. They also reduce risk to manufacturers and installers, as high-quality standards mean fewer call-backs and less chance of litigation.

Most importantly, these regulations provide solid consumer protection for those owning and living in manufactured housing in the form of improved life safety, fire safety, energy efficiency, severe weather resistance and quality of construction.

Just as automobile manufacturers need to meet the Federal Motor Vehicle Safety Standards (FMVSS), food producers need to meet the United States Federal Food, Drug, and Cosmetic Act (FFDCA, FDCA, or FD&C) and electronics manufacturers need to meet the Consumer Product Safety Improvement Act of 2008 (CPSIA), Public Law 112–28, August 12, 2011, so too does the manufactured housing industry need to meet the National Manufactured Housing Construction and Safety Standards Act.

When an MHU changes hands or needs to be financed, industry professionals such as valuators, financiers and settlement companies reduce their risk by verifying that the unit was built to HUD standards. This process involves certification label usage and records, including label verification letters and data plate/compliance certificates, similar to a title search on a standard home.

IBTS maintains the data for the required certification labels and data plates for manufactured homes. The verification letter provided suffices in most cases for missing certification labels or unknown manufacturer data for specific homes.

The IBTS Performance Certificate is based on production reports provided by the home manufacturer. The certificate is based on the zone requirements in effect at the time the home was manufactured, for the location of the home’s final destination (dealer/retail center). However, the certificate does not allow for changes to the home’s construction, or subsequent home moves that may affect the home performance information.

MHU regulations provide solid consumer protection for those owning and living in manufactured housing, as well as reduced risk for realtors and finance companies.

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