De-titling a mobile home in Tennessee is an important process for homeowners who want to classify their manufactured home as real property rather than personal property. This classification can have significant benefits, including improved financing options and increased property value. In this blog post, we’ll break down the entire process of de-titling a mobile home in Tennessee, including the steps involved, costs, and the pros and cons of de-titling your home.
What Does De-Titling a Mobile Home Mean?
De-titling a mobile home means converting the home from personal property (similar to a vehicle) to real property (like a house). In Tennessee, this involves several legal steps, including ensuring the home is permanently affixed to the land and updating the county records to reflect the change in status.
Steps to De-Title a Mobile Home in Tennessee
1. Ensure the Home is on a Permanent Foundation
The first step in de-titling your mobile home is to ensure it is placed on a permanent foundation. This typically includes a concrete slab, piers, or a crawl space. The foundation must meet local building codes and regulations.
2. Obtain a Certificate of Affixation
A Certificate of Affixation is a document that certifies the mobile home is permanently affixed to the land. This document is required to de-title the home. To obtain this certificate, you’ll need to:
- Contact a licensed engineer or contractor to inspect the foundation.
- Submit an application for the Certificate of Affixation to your local building department or zoning office.
- Pay any associated fees for the inspection and certification.
3. Surrender the Title
Once you have the Certificate of Affixation, you must surrender the mobile home’s title to the Tennessee Department of Revenue. This involves:
- Filling out a form to request the cancellation of the title.
- Submitting the completed form along with the Certificate of Affixation and the original mobile home title.
- Paying any required fees for the title cancellation.
4. Record the Deed
After surrendering the title, you must record the mobile home as real property with the county register of deeds. This process includes:
- Updating the property deed to include the mobile home.
- Submitting the updated deed and the Certificate of Affixation to the county register of deeds office.
- Paying the recording fees, which vary by county.
Costs Involved in De-Titling a Mobile Home
The costs associated with de-titling a mobile home in Tennessee can vary depending on several factors. Here’s a breakdown of potential expenses:
- Foundation Installation: Costs for installing a permanent foundation can range from $5,000 to $15,000 or more, depending on the type of foundation and local construction costs.
- Inspection and Certification Fees: Fees for obtaining the Certificate of Affixation can range from $200 to $1,000, depending on the inspector or contractor.
- Title Cancellation Fee: The Tennessee Department of Revenue charges a fee for canceling the mobile home title, typically around $25.
- Recording Fees: County recording fees for updating the deed can range from $10 to $100, depending on the county.
Pros of De-Titling a Mobile Home
1. Improved Financing Options
One of the main advantages of de-titling a mobile home is the ability to qualify for traditional mortgage financing. Loans for real property often come with better terms and lower interest rates compared to personal property loans (chattel loans).
2. Increased Property Value
De-titling your mobile home can increase its market value. Homes classified as real property are generally seen as more permanent and desirable investments.
3. Legal Protections
Real property is afforded greater legal protections. For example, real property can be covered under homestead exemption laws, which protect a portion of the home’s value from creditors.
4. Tax Benefits
In many cases, property taxes for real property can be more favorable than personal property taxes. Additionally, you may be eligible for certain tax deductions associated with real property.
Cons of De-Titling a Mobile Home
1. Initial Costs
The process of de-titling can be expensive, particularly the cost of installing a permanent foundation and obtaining the necessary inspections and certifications.
2. Time-Consuming Process
De-titling a mobile home involves multiple steps and dealing with various government agencies, which can be time-consuming and sometimes complex.
3. Permanent Commitment
Once a mobile home is de-titled, it becomes a permanent part of the land. This means it cannot be easily moved in the future, limiting flexibility for homeowners who might want to relocate the home.
Final Thoughts
De-titling a mobile home in Tennessee is a process that can provide significant benefits, including improved financing options, increased property value, and greater legal protections. However, it also comes with costs and a permanent commitment. By understanding the steps involved and weighing the pros and cons, homeowners can make an informed decision about whether de-titling is the right choice for them. If you’re considering de-titling your mobile home, ensure you follow the necessary steps and consult with professionals to navigate the process smoothly.
By taking these steps, you can enjoy the benefits of having your mobile home classified as real property, ultimately enhancing your investment and securing your home’s future.