Expert: Michael McClure - 7/15/2009

Question
QUESTION: Hi Michael -
Last August we took out a loan for a mobile home in a 55+ park for my parents who were moving into the state.  We were told by the loan broker that we could add my father as a registered owner after escrow closed in order to satisfy the park owner/occupancy rules.  Well, needless to say, after speaking with HCD, this cannot be done short of paying the loan in full, which is impossible for us to do.  They informed us that we are jeapordizing my parents residency at the park. We are in a quandry as to what to do.

ANSWER: Hi Ellen...please answer these questions for me:

What state?
Is the park after you for this to be done?
Have you discussed this with the lender?  Who is the lender?

Regards   Mike

---------- FOLLOW-UP ----------

QUESTION: This is in California.  The park isn't really after us yet, although the manager mentioned to me once that they needed for their files. My parents recently recieved notice that they are re-doing all the leases so I know once they look at the file and see that they still do not have it will be an issue.

HCD said most lenders, in particular ours which they've worked with prior - 21st Century Mortgage - are not typically willing to add a name to the title.  So, no we have not spoken with the lender.  My parents have a bankruptcy so adding them even to the loan is not an option.

I'm still trying to figure out if title & registration are one and the same or if its possible to add them to the registration without adding them to the title.  When my husband spoke to HCD he may have been referring to the title.

Thanks for any info you can provide.

ANSWER: Hi again...are you in my area?  If so, I may know the park management.
The HCD and park just  does not want renters.  By not being on the title, it could appear that way.
I my experience, senior parks know that families help, and usually will look the other way on something like this. I say leave it alone..there is not much they can do now that they allowed move-in.
If it would become an issue, I would suggest a letter stating that you have no interest in possessing the home under any conditions, and this was all about helping parents.

Good luck   "~ M

---------- FOLLOW-UP ----------

QUESTION: We are in Hemet. Actually, this sort of became an issue at close of escrow - the escrow agent balked at it and had us sign a letter stating that we would be responsible for adding my parents to title after close of escrow - we did this after being assured by the loan broker that it would not be a problem to add them after the fact, that its done all the time with family members. I guess our mistake was believing him since he obviously just wanted the transaction done and because we were under the gun so to speak needing the escrow to close asap for my parents arrival. The park management has a copy of the letter in my parents file.  We also talked to the management prior to close of escrow regarding this issue, who in-turn spoke with the park owner, and we were told we absolutely had to have one or both of my parents as a registered owner, no exceptions.  So you can see why I am concerned. I suppose if the lease renewals weren't imminent, I wouldn't be as worried since it was, up til now an 'out of sight, out of mind' issue, but as that is coming up I am worried what that will mean for my parents, who are, as of this point, oblivious to this situation.

By the way, found out through HCD that once registration takes place, then titling docs are issued.  I'm still unsure though as to whether its possible to add a registered owner without adding them to the title..do you know?

Thanks.

Answer
Hi E
Well, the escrow agent should have known that this would be an issue...after all, they do the titling!  The title and reg. are both HCD docs., and you can't change either.

As I said, I would let it go for several reasons;

1.  Parks' book keeping is not the best, and unless this has been brought up lately, they will probably not remember(especially in a large park).

2.  They would have to go through an enormous amount of effort to evict your folks.  They have to file a lien (stating the reason), pay about $6-7k in Atty fees+court costs, face the bad publicity of kicking out seniors for "no reason" due to a paperwork error.

3.  They would have to ask your parents to remove the home from the park, leaving them missing income at the time.

I know you are in a dilemma, but short of begging the lender to make a concession and going back to the broker and escrow people for advice...your stuck.

See how things shake out and I think you'll be OK...All the best "~ M