Can someone give me an example of a scenario when you would use Indirect Land Ownership for manufactured home land property interest ?

Thanks in advance!

Paragraph 4(a)(30)

1. Indirect land ownership. Indirect land ownership can occur when the applicant or borrower is or will be a member of a resident-owned community structured as a housing cooperative in which the occupants own an entity that holds the underlying land of the manufactured home community. In such communities, the applicant or borrower may still have a lease and pay rent for the lot on which his or her manufactured home is or will be located, but the property interest type for such an arrangement should be reported as indirect ownership if the applicant is or will be a member of the cooperative that owns the underlying land of the manufactured home community. If an applicant resides or will reside in such a community but is not a member, the property interest type should be reported as a paid leasehold.

A coop owns the land where the MH will be placed.

I don't have experience with manufactured homes, so I don't know where the land ownership and whether the land is included in the transaction would be documented.

I imagine that it would be part of a title report or appraisal, but that's just an assumption. Would anyone be willing to enlighten me?

Our institution does not lend on Manufactured Homes, so I haven't been overly concerned with getting this answered, but I would still like to know.

Okay, here is what you will typically see.

1) the MH's are titled and you only take the title [chattel property] - you have no interest in the land, just the MH.
2) the MH's are titled and you take the title [chattel] and the land [by Deed/Mortgage/whatever your state calls it] - your security consists of both the MH and the land.
3) the titles to the MH's have been retired, making the home a part of the Real property. Your Deed/Mortgage is your security and you have an interest in both the MH and the land.

If the loan is or would have been secured by a MH:

Manufactured Home Information - you simply report if the loan is or would have been secured by both the MH and land or by the MH only.

Manufactured Home Land Property Interest - this relates to the borrower's interest in the land

Direct ownership - the borrower owns the land.
Indirect ownership - most common is the property is in a cooperative.
Paid Leasehold - the borrower has a written lease agreement that specifies rent payments.
Unpaid Leasehold - the borrower does not have a written lease agreement.


We haven't done manufactured home lending for some time but we would question the applicant concerning the property where the MH would be placed and their answer would dictate how we would proceed. If they said the property would be rented then we would require the necessary documents from the landlord and a rent waiver. I don't remember the legal term but it basically says if we have to repo the MH we don't have to pay any past due land/lot rent to take possession of the MH.