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Alabama Law for You

  • Writer's pictureGregory Stanley

Are Manufactured Homes Real Property?

Intelligent minds can disagree.  Some people say mobile homes affixed to the ground are real property.  Other people will tell you that mobile homes are actually personal property.  The law in Alabama is clear, you just need to determine ownership, purpose, location, rentals, year of manufacture, and whether the arcane process of “Title destruction” has been completed, and apply the Alabama Uniform Commercial Code.

Rule of Thumb: Mobile Homes are NOT real property and do not convey with the real property upon which the sit. Manufactured homes may be subject to either a registration fee or ad valorem tax assessment but that alone does not determine their status as real or personal property.

Manufactured homes are always personal property subject to an annual county registration fee if they are rented, leased, or located on land owned by someone other than the manufactured homeowner. That’s a fairly easy categorization that mobile homes must be registered with the county and taxes paid as personal property.  On the other hand, manufactured homes are subject to real property tax and do not have to be registered with county if the mobile homeowner also owns the real property under the mobile home, and lives or works in it themselves-but that doesn’t make it part of the real property. 

Rule: Removing trailer wheels or trailer tongues, tying a mobile home down, or putting a skirt under a trailer have no effect on the mobile home’s property status.  This is important because you can buy the land, and the trailer won’t convey with the land.

In general, if you own the land and the mobile home and you live in it, it can be taxed as real property.  If its rented, or is on rented land, then it can be taxed by registration with a new sticker annually and not taxed with the real property.  But there is another issue.  Alabama law allows mobile homes to be used as collateral for loans just like cars (as opposed to a mortgage on the real property.)  And just like cars, if the owner stops paying, the lender may have a right to repossess the mobile home-even if it is “fixed” to the ground. 

A loan using a mobile home as collateral does not have to be recorded with the county property records, or with the secretary of state UCC records. A buyer is responsible to ask the seller for their title, and that is the only way buyers will get notice of the lien.  This lien is not recorded in the probate land records where deeds and mortgages are recorded.  A mobile home’s status as personal property remains, and they can be repossessed as long as there is a lien on it, even if you bought the land under it.

If you buy real property with a mobile home on it, be careful:  A deed is not likely to be effective to convey a mobile home along with the land because deeds convey real property, not personal property.  This applies to buying at a foreclosure as well.

Always use a reputable Alabama Lawyer when you are dealing with real property purchases, whether it has a trailer on it or not.

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