Public Act 98-0749 (IL)

Conveyance and Encumbrance of Manufactured Homes as Real Property and Severance Act

Effective date: 7/16/2014

New Act – 765 ILCS 170/5 through 55

Statutes Amended – 35 ILCS 200/1-130, 515/1, 515/4; 205 ILCS 5/3, 5/5a, 5/5d, 5/6.1, 105/1-10.30, 105/5-2, 205/6002, 205/6008, 305/46, 305/46.1, 635/1-4; 210 ILCS 115/2.1, 117/10; 430 ILCS 115/2, 117/10; 625 ILCS 5/1-144.03 (new), 5/3-100, 5/3-102, 5/3-103, 5/3-104, 5/3-106, 5/3-107, 5/3-109, 5/3-110, 5/3-116, 5/3-116.1 (new), 5/3-116.2 (new), 5/3-116.3 (new), 5/3-202, 5/3-205, 5/3-207, 5/3-208; 735 ILCS 5/15-1213; 765 ILCS 5/38, 77/5, 745/3, 905/13.1 (new), 1005/5 (new); 810 ILCS 5/9-102, 205/4, 205/4.2, 205/4a, 375/2.1, 405/2.1

PA 98-0749 created The Conveyance and Encumbrance of Manufactured Homes as Real Property and Severance Act (the Act) and also modified several other statutes.

The Conveyance and Encumbrance of Manufactured Homes as Real Property and Severance Act

The Conveyance and Encumbrance of Manufactured Homes as Real Property and Severance Act (the Act) was enacted with the purpose to 1) clarify the legal status of manufactured homes affixed or to be affixed to real property and 2) establish a statutory procedure for converting and severing manufactured homes outside of mobile home parks into and from real property. 765 ILCS 170/5-1.

First, Section 5-5 provides that a manufactured home is affixed to a permanent foundation if the wheels, axles, and towing hitch are removed, and it is anchored to real property by attachment to a permanent foundation and connected to residential utilities. 765 ILCS 170/5-5.

Second, the Act sets forth four requirements that a person must take in order to covert a manufactured home into real property. The requirements are:

  1. the manufactured home is affixed to a permanent foundation pursuant to Section 5-5 of the Act;
  2. an affidavit of affixation conforming to the Act is filed with the county recorder;
  3. a certified copy of the recorded affidavit is delivered for filing with the Secretary of State (SOS); and
  4. the requirements of the Illinois Vehicle Code Sections 3-116.1 or 3-116.2 have been satisfied.

765 ILCS 170/5-30.

Section 5-15 provides the requirements for the affidavit of affixation and a form compiling all the required information that must be used by the person with an ownership interest to record with the county recorder. 765 ILCS 170/5-15.

Section 5-25 provides that once fees are paid and the affidavit of affixation has been recorded with the county recorder, the recorder shall endorse the affidavit and forward a certified copy to the person so that they can file the certified copy with the Secretary of State. 765 ILCS 170/5-25.

Section 5-35 provides that once a person has satisfied Section 5-30 of the Act, the manufactured home will be treated as real property. Therefore any mortgage, deed of trust, lien or security interest that can attach to the land or buildings shall be treated as if the manufactured home were built from ordinary building materials on site. 765 ILCS 170/5-35.

Sections 5-40 and 5-45 provides that the Act supplants common law as it relates to manufactured homes and that the Act is not retroactive. 765 ILCS 170/5-40, 765 ILCS 170/5-45.

Section 5-50 provides the steps required by a person to sever the manufactured home from real property. The Section requires that the person file an affidavit of severance with the county recorder, pay all applicable fees and file a certified copy with the Secretary of State. The Section also provides the affidavit of severance form. 765 ILCS 170/5-50.

Section 5-55 provides that the holder of a Manufacturer’s Statement of Origin may deliver it to any person to facilitate conveying or encumbering the manufactured home. 765 ILCS 170/5-50.

The Uniform Commercial Code

Section 9-102 provides the definition of a manufactured home subsequent to the Act. 810 ILCS 5/9-102. The definition states:

“Manufactured home means a structure, transportable in one or more sections, which, in the traveling mode, is eight body feet or more in width or 40 body feet or more in length, or, when erected on site, is 320 or more square feet, and which is built on a permanent chassis and designed to be used as a dwelling with or without a permanent foundation when connected to the required utilities, and includes the plumbing, heating, air-conditioning, and electrical systems contained therein. The term includes any structure that meets all of the requirements of this paragraph except the size requirements and with respect to which the manufacturer voluntarily files a certification required by the United States Secretary of Housing and Urban Development and complies with the standards established under Title 42 of the United States Code. The term "manufactured home" does not include campers and recreational vehicles.”

The Illinois Vehicle Code

Section 1-144.03 provides the definition of manufactured home defined in Section 9-102 of the Uniform Commercial Code. 625 ILCS 5/1-144.03.

Section 5/3-100 provides that vehicle also means manufactured home in the Code. 625 ILCS 5/3-100.

Section 5/3-102 provides to exclude a manufactured home as a vehicle that the SOS needs to obtain a title from pursuant the Act, unless there has been recorded an affidavit of severance pursuant to the Act. 625 ILCS 5/3-102.

Section 5/3-103 provides who may apply for a certificate of title. 625 ILCS 5/3-103.

Section 5/3-104 provides the definition of manufactured home into the procedure for applying for the certificate of title and specifies what the holder of the Manufacturer’s Statement of Origin must do once the manufactured home is sold. 625 ILCS 5/3-104.

Section 5/3-106 provides that the SOS shall file and maintain a record of the affidavit of affixation or the affidavit of severance upon receipt of the document. 625 ILCS 5/3-106.

Section 5/3-107 provides that a certificate of title issued by the SOS is prima facie evidence that a manufactured home has become affixed in any manner to real property. 625 ILCS 5/3-107.

Section 5/3-109 provides an opportunity for the SOS to register a manufactured home without the Manufacturer’s Statement of Origin if the applicant provides sufficient documents showing ownership or by placing a bond equal to one and one-half times the value of the manufactured home. 625 ILCS 5/3-109.

Section 5/3-110 provides that, except provided in Section 3-116.2, the SOS cannot refuse to issue a certificate of title for a manufactured home affixed to real property. 625 ILCS 5/3-110.

Section 3-116.1 provides that the person intending to affix their property pursuant to the Act must surrender their Manufacturer’s Statement of Origin to the SOS by filing an application with the SOS and pay any applicable fees. 625 ILCS 5/3-116.1. Upon satisfaction, the SOS will cancel the Manufacturer’s Statement of Origin, update the record and provide written notice to all persons identified on the application. Id. Furthermore, if the application to surrender the Manufacturer’s Statement of Origin is delivered to the SOS within 60 days of recording the affidavit of affixation with the county recorder and the application is accepted, then the requirements of Section 3-116.1 will be satisfied on the date the affidavit of affixation is recorded. Id.

Section 3-116.2 provides the owner of a manufactured home that is covered by a certificate of title may surrender the certificate of title to the SOS  in order to permanently convert the property in accordance with the Act. 625 ILCS 5/3-116.2.

Section 3-116.3 provides the application requirements for a certificate of title to a severed manufactured home. 625 ILCS 5/3-116.3.

Section 3-202 provides the holder of a purchase money security interest in a manufactured home has a perfected interest against claims of judicial lien creditors and execution creditors on or after the date the purchase money security interest attaches; and the SOS shall not file an affidavit of affixation, cancel the Manufacturer’s Statement of Origin, nor revoke the certificate of title. 625 ILCS 5/3-202.

Section 3-205 provides the holder of a security interest or lien in a manufactured home may release the documents to any person to facilitate conveying or encumbering the manufactured home. 625 ILCS 5/3-205.

Section 3-207 provides that a security interest attached to a manufactured home that is deemed real property in accordance with Section 5-30 of the Act will be governed by the laws applicable to real property, not the Illinois Vehicle Code. 625 ILCS 5/3-207.

Section 3-208 provides the SOS cannot suspend or revoke a certificate of title to a manufactured home once it has become affixed to real property. 625 ILCS 5/3-208.

The Mobile Home Local Services Tax Act

The Act amends the Mobile Home Local Services Tax Act to adopt Section 9-102 of the Uniform Commercial Code defining manufactured home, and provides that any mobile home or manufactured home outside of a mobile home park shall be assessed and taxed as real property as defined in the Property Tax Code, however dealer’s lot for resale are not subject to this tax. 35 ILCS 515/1. If the mobile or manufactured home is relocated to a mobile home park then it must be taxed according to the Mobile Home Local Services Tax Act. Id.

Section 4 provides the owner of a mobile or manufactured home outside a mobile home park shall record with the county recorder’s office a mobile home registration form within 30 days and subject to recording fees. 35 ILCS 515/4.

Separate Acts and Code Affected by PA 98-0749

PA 98-0749 amends the Illinois Banking Act to incorporate manufactured homes as real estate, in which a bank may take as collateral to loan money. 205 ILCS 5/3. Section 5a expands the definition of “homestead” to include the definition of manufactured home defined in the Section 9-102 of the Uniform Commercial Code and Section 5-35 of the Act. 205 ILCS 5/5a. Sections 5d and 6.1 expand the definition of “real property” to include manufactured home defined in the Section 9-102 of the Uniform Commercial Code and Section 5-35 of the Act. 205 ILCS 5/5d, 205 ILCS 5/6.1.

PA 98-0749 amends the Savings Bank Act to include the definition of manufactured home defined in the Section 9-102 of the Uniform Commercial Code and Section 5-35 of the Act. 205 ILCS 205/6002, 205 ILCS 205/6008.

PA 98-0749 amends the Illinois Credit Union Act to include the definition of manufactured home defined in the Section 9-102 of the Uniform Commercial Code and Section 5-35 of the Act.205 ILCS 305/46, 205 ILCS 305/46.1.

PA 98-0749 amends the Residential Mortgage License Act of 1987 to include the definition of manufactured home defined in the Section 9-102 of the Uniform Commercial Code and Section 5-35 of the Act. 205 ILCS 635/1-4.

PA 98-0749 amends the Illinois Savings and Loan Act of 1985 to expand the definition of “real property” to include the definition of manufactured home defined in the Section 9-102 of the Uniform Commercial Code and Section 5-35 of the Act. 205 ILCS 105/1-10.30, 205 ILCS 105/5-2.

PA 98-0749 amends the Manufactured Home Quality Assurance Act to include the definition of manufactured home defined in the Section 9-102 of the Uniform Commercial Code. 430 ILCS 117/10.

PA 98-0749 amends the Code of Civil Procedure to expand the definition of “real estate” to include the definition of manufactured home defined in the Section 9-102 of the Uniform Commercial Code and Section 5-35 of the Act.735 ILCS 5/15-1213.

PA 98-0749 amends the Conveyances Act to expand the definition of “real estate”  and “real property” to include the definition of manufactured home defined in the Section 9-102 of the Uniform Commercial Code and Section 5-35 of the Act.765 ILCS 5/38.

PA 98-0749  amends the Residential Real Property Act to include the definition of manufactured home defined in the Section 9-102 of the Uniform Commercial Code. 765 ILCS 77/5.

PA 98-0749 amends the Mobile Home Landlord and Tenant Rights Act to include the definition of manufactured home defined in the Section 9-102 of the Uniform Commercial Code. 765 ILCS 745/3.

PA 98-0749 amends the Mortgage Act and Joint Tenancy Act to expand the definition of real property to include manufactured home defined in the Section 9-102 of the Uniform Commercial Code and Section 5-35 of the Act.. 765 ILCS 905/13.1, 765 ILCS 1005/5.

The Act amends the Property Tax Code to incorporate the existence of the Act and makes it possible to classify a manufactured or mobile home in a mobile home park as real property rather than only a chattel. 35 ILCS 200/1-130.

The Act amends the Mobile Home Park Act and the Abandoned Mobile Home Park Act to include the definition of manufactured home defined in the Section 9-102 of the Uniform Commercial Code, clarify that “mobile home” and “manufactured home” are synonymous throughout the both Acts, and to specify that “abandoned mobile home” means a mobile home located inside a mobile home park. 210 ILCS 115/2.1,          210 ILCS 117/10, 430 ILCS 115/2.

For more, see ATG's Underwriting Guidelines for Manfuactured Homes in Illinois.

Bill Number: 
HB 5938
Public Act or Public Law Number: 
PA 98-0749
By: ATG Underwriting Department | Posted on: Mon, 10/27/2014 - 1:43pm