Plumbing hung at the factory can be damaged during transit or, as seen here, needs to be adjusted after the house is in place. Sagging pipes are likely to back up or crack from stress. Photo courtesy of Janis Paris.

LAKE COUNTY – The Manufactured Housing Citizens Group has launched a survey of manufactured home purchasers in Lake County. Initial surveys have been mailed to buyers who have previously contacted the group, and mail-in forms will be sent to anyone requesting them. Deadline for completion of the forms is April 15.

The survey will be used to demonstrate to the Lake County Board of Supervisors that the county needs to take steps to better protect consumers of manufactured housing. The group, whose Web site can be viewed at www.LakeLive.org/MFhousing, will ask the county to either upgrade the inspection/permit criteria for new manufactured homes or to pass an ordinance requiring that local dealers disclose to buyers their legal right both to hire an attorney to review purchase contracts and to hire an independent home inspection, which must be passed before the buyer’s funds are released.

According to the Manufactured Housing Citizens Group, current inspections rendered by the county are not detailed enough to ensure that the homes are installed “accordingly to manufacturers specifications” (per the Senate Select Committee on Mobilehome and Manufactured Housing).

The group has taken dozens of complaints from Lake County buyers in the past four years of its existence, and these complaints appear to be typical of the findings of the famous AARP study of 1999 that found that three of every four new manufactured homes has serious problems, most of which are not corrected by the dealer but are paid for by the buyer.

Although the manufacture of the units themselves is governed by federal law, installation has been left up to the states and leaves the consumer extremely vulnerable. Once money is transferred, dealers and manufactures may have little interest in correcting problems. State agencies and licensing boards may eventually be effectual, but consumers need to be aware that these boards who supposedly look after buyers are equally mandated to protect the interests of the trade and industry people at fault. And purchase contracts do not typically provide for attorney’s fees to the winner thus making legal help too expensive for the average buyer.

Consumers across the country are trying for improved legislation at all levels (federal, state and county) to standardize and upgrade installation of new manufactured homes. This is particularly relevant to areas like Lake County where economical housing is imperative.

The typical buyer of manufactured housing is both older (over 52 years old) than the typical buyer of stick-built housing and earns less than $30,000 per year. Manufactured housing can cost substantially less than stick-built housing (as much as half the cost), and a properly supervised industry could go a long way to improving the state’s housing shortage.

The group hopes that Lake County can serve as a model for state legislation by upgrading inspections if feasible, and if not, then implementing a mandatory disclosure to buyers warning them of the inadequacy of current protections.

The group

In the past several years the group has presented a legislative proposal to lawmakers with a petition signed by over 100 Lake County residents. The group conducts one or more educational seminars every year teaching the public how to protect themselves when buying a manufactured home.

The Lake County group has worked closely with Consumers Union, the nonprofit branch of Consumer Reports, and this national group has furnished dozens of the publication “Tips on Mobilehomes” free to county residents, available at local seminars or by phoning the local group.

This publication is listed among the bibliography carried on the local group’s Web site in addition to several other important documents. One of these is the Manufactured Housing Institute’s primer about how to buy a manufactured home (less detailed than Consumers Unions’ “Tips”). Other items are links to a list of all U.S. manufacturers, information about independent inspectors, and California licensing and trade organizations (with instructions about how to lodge complaints).

Local data listed on the Web site includes references to local attorneys and a checklist to follow when hiring legal services. Lake County is lucky to have several attorneys knowledgeable and willing to work on the buyer’s side. Future projects include a legal addendum (a project currently under way) that will consist of approximately one page of legal clauses that offers more protection to the buyer than does the standard purchase contract. Buyers will be able to download this page and discuss it with their attorney.

The group hopes to encourage dealers to accept the terms of this addendum and for those who do, the Web site will list them under “recommended dealers.” This should serve as a positive alternative for those who are ready to purchase.

While lawsuit is not the primary solution recommended by the group, the Manufactured Housing Citizens Group has been instrumental in organizing several lawsuits against Lake County dealers, including a “group-action” lawsuit of multiple families.

Although there is a California “ombudsman” who licenses manufactured housing dealers (within HCD, the state agency responsible for administering HUD), the California agency has been reluctant to make information available to the public about violations/citations against individual dealers. Consumers Union has a campaign for all 50 states to make such information readily available, but California ombudsman Richard Weinert justifies refusing this request by saying that this information can “easily mislead.”

The ombudsman’s office has similarly justified the exorbitant fee for looking up information about dealers’ violations: although the California code says this fee should be “reasonable,” the HCD fee chart cites $196 for this information. The Lake County Democrats expressed concern that this fee impeded public access, but the ombudsman responded that this information “requires an extensive search”; Weinert’s office went on to say that they are “pursuing the ability to list disciplinary actions against licensees online” but that this “development like the license query engine project did, takes time.” (The license query engine lists all other information required by law to be furnished to the public except information about violations.)
 
The problem

Consumers Union is adamant that until legislation is enacted at state and federal levels supervising the installation of manufactured housing, the consumer must protect him or herself by ensuring that money is kept back (much like a construction loan) until the home is inspected by a professional hired by the buyer. Obviously an attorney should be engaged to oversee this. In an informal survey conducted by the Manufactured Housing Citizen’s Group of professionals involved in the industry, it has been suggested that at least 10 to 20 percent of the total price should be kept back in order to provide an incentive.

What are the problems that arise from unlegislated and potentially poor installation? AARP and Consumers Union agree that the most serious problems occur when the installer does a poor job of the plumbing or foundation (which would include the soil work); in fact, AARP says the majority of problems reported in its survey are “serious” and defines this as a problem that, if not resolved, can cause an array of other problems.

For instance, foundational problems can cause unsettling of the house and all working components like doors and windows and cupboards. Additionally, the house can separate at the center seam, and bad grading or uncompacted soil can cause flooding in the substructure. Buyers also report instances of witnessing installers connect two halves of a home with wet insulation (having seen the separate units sit in the rain for days or weeks prior to installation). Leaking pipes can be caused by cracks caused in transport or loose connections made by the installer. Pipes that leak into the walls or floorboard can easily introduce mold.

Buying a new car has far better protection than buying a manufactured home. This is largely because the law allows shared liability between the dealer and the manufacturer. The literature says that if a buyer is unable to obtain satisfaction from a dealer, he or she can call upon the manufacturer for repairs. Although this has been effective in a few cases, the local group finds that no one manufacturer has been consistently reliable in that regard. What happens most often is that the dealer says a certain repair is the responsibility of the manufacturer while the manufacturer blames the problem on the dealer – and the buyer is caught in the middle!

Although the 300 companies in the United States that manufacture pre-built homes are federally supervised, there are approximately 7,000 dealers installing these homes, and they have a strong incentive to lobby against laws that would impose stricter standards.

The problems commonly reported to the Manufactured Housing Citizens Group include the following: Homes are installed on loose soil or on grades that drain water toward the home (where it pools in the substructure), shabby construction of foundation piers, plumbing hung so as to cause stress on pipes, leaks that cause mold, uneven floors, broken roof tiles, missing tar paper, homes not properly joined at center, homes that are lower on one side than the other, uninstalled flooring or fixtures, and so on.

One of the biggest complaints the group receives is that county inspectors do not look under the home to verify foundation or plumbing. Another is that the dealer/installer promised buyers they could move in within a matter of months but actually took much longer, robbing buyers of valuable savings by forcing them to pay for many months rent in temporary situations.

A new phenomenon is being reported in Lake County: even though a dealer advertises an operation as “turnkey” (meaning the dealer promises to handle all details, permits, and so on, up to full move-in), at a later date tells the buyer that the company cannot handle the installation – and that if the buyer wants their house completed on time, he or she will have to sign a separate agreement with a private contractor. The Manufactured Housing group has been referring cases like this to a lawyer.

Buyers who have purchased a manufactured home and would like to participate in the survey can call 998-0249 to have a confidential form mailed to them. More information about the group is available at www.LakeLive.org/MFhousing.

Mold is a common complaint in new manufactured housing. The mold pictured here is a result of water leaking at the pipe joint. Water can also penetrate wall insulation when half-units stand for days or weeks waiting to be connected to other units. Photo courtesy of Janis Paris.