MH repossession. MH park is asking me to cover the rent.

[Doron Rice]

Hi- I need advice from anyone who has any Mobile Home (MH) experience. I'm a lender to a mobile home owner whose MH is residing in a private MH park. The owner has defaulted on his loan already with me and is also not paying rent to the park. As such, the park has taken him to court last Thursday in an attempt to evict him. As of today, the owner is still in his MH and is claiming he will pay the park (he has not done so). I'm in a compromising position because the title of the MH is under the owners name with me as the lien holder. We have a contract with me as lender. However, the MH Park has been and is holding on to the physical title in their locked up files. So here are my questions:

1) as lien holder to title, Don't I have right to get physical title back from the Park?

2) dont I have right to repossess the MH?

3) the Park is telling me that I am now responsible to pay them for the backed up rent incurred by owner (approximately $2,000). And If I don't, I face losing possession of the MH to the park. Is this true? How am I legally responsible for paying the owners rent?

Any advise & suggestions?

[Ken Rishel]

OK. I am jumping in on this. As a long time lender, I have several observations:

• How did the park get the title in the first place? Titles when properly executed are supposed to be mailed by the titling authority to the primary lien holder in almost every state unless it was an electronic filing in which case the park would not have the title.
• You, as a lender, should have had a written agreement with the park as to you, the lender's relationship with the park that should spell out any obligations you have or don't have to the park and any obligations they have or don't have to you the lender.
• The park does not have the right to stop your repossession, but they may, depending on the state, place an additional lien on the home for back lot rent if you do not have a written agreement with the park to the contrary. In some states they can legally prevent you from removing the home until their lien is satisfied.

If I were in your position, I would be talking to the ownership of the park. If you are willing and able to make future loans in their park, that should be of value to them and gives you something to negotiate with.

The lesson here is never, never, make a loan on a manufactured home in a land lease community if you do not have a decent relationship with the park owners and a written agreement regarding lot rent and other fees the park may feel is due them. Lesson two may be that you need to handle titling more professionally.