Does the new requirement to provide a mortgage disclosure for purchases of manufactured homes apply to loans secured by “park models” (which do not move, but are built on a chassis and often have an enclosed skirting around them)? We lend to residents of a recreational village where most borrowers own the land the park model sits on, but some may lease the land.

No, we do not believe the new disclosure requirement applies to “park models” (also known as “park model recreational vehicles”), which we do not believe are considered “manufactured homes” under the Mobile Home Park Act. Provided that the park models are not used for permanent habitation and meet the definitions of “park model” discussed below, the disclosure requirement should not apply.

The disclosure requirement applies “when offering terms for a mortgage note for the purchase of a manufactured home, as defined in the Mobile Home Park Act” — which defines manufactured homes as “structures designed for permanent habitation,” among other attributes, and excludes recreational vehicles.

Although the Mobile Home Park Act does not reference “park models,” the Illinois Vehicle Code defines a “park model” as “a vehicle that is incapable of self-propulsion that is less than 400 square feet of habitable space that is built to American National Standards Institute (ANSI) standards that prohibits occupancy on a permanent basis and is built on a vehicle chassis.” Additionally, the RV Industry Association, which is accredited to manage the ANSI “Park Model Recreational Vehicle Standard,” has stated that park model recreational vehicles “are neither designed nor intended by their manufacturers to be used as permanent residences.”

Consequently, we do not believe the disclosure requirement applies to park models, which do not meet the Mobile Home Park Act definition of “manufactured homes” since they are considered recreational vehicles that are not intended for permanent habitation.

For resources related to our guidance, please see:

Consumer Fraud and Deceptive Business Practices Act, 815 ILCS 505/2WWW(a) (“A lender, or agent of a lending company, when offering terms for a mortgage note for the purchase of a manufactured home, as defined in the Mobile Home Park Act, that has not been caused to be deemed to be real property by satisfying the requirements of the Conveyance and Encumbrance of Manufactured Homes as Real Property and Severance Act, shall disclose:

(1) any affiliation between the landlord and the lending company;

(2) that the loan is a chattel loan;

(3) that the terms of a chattel loan prohibit refinancing;

(4) that, depending on where the consumer affixes the manufactured home (be it property owned by the consumer or on certain types of leased land), the manufactured home may qualify as real property under the Conveyance and Encumbrance of Manufactured Homes as Real Property and Severance Act; and

(5) any other reason that prohibits refinancing.”)

Mobile Home Park Act, 210 ILCS 115/2.1 (“‘Manufactured home’ means a factory-assembled, completely integrated structure designed for permanent habitation, with a permanent chassis, and so constructed as to permit its transport, on wheels temporarily or permanently attached to its frame, and is a movable or portable unit that is (i) 8 body feet or more in width, (ii) 40 body feet or more in length, and (iii) 320 or more square feet, constructed to be towed on its own chassis (comprised of frame and wheels) from the place of its construction to the location, or subsequent locations, at which it is connected to utilities for year-round occupancy for use as a permanent habitation, and designed and situated so as to permit its occupancy as a dwelling place for one or more persons, and specifically includes a ‘manufactured home’ as defined in subdivision (53) of Section 9-102 of the Uniform Commercial Code. The term shall include units containing parts that may be folded, collapsed, or telescoped when being towed and that may be expected to provide additional cubic capacity, and that are designed to be joined into one integral unit capable of being separated again into the components for repeated towing. The term excludes campers and recreational vehicles. The term ‘mobile home’ shall not include modular homes and their support systems. The words ‘mobile home’ and ‘manufactured home’ are synonymous for the purposes of this Act.”)

Illinois Vehicle Code, 625 ILCS 5/5-101.2(a) (“‘Park model’ means a vehicle that is incapable of self-propulsion that is less than 400 square feet of habitable space that is built to American National Standards Institute (ANSI) standards that prohibits occupancy on a permanent basis and is built on a vehicle chassis.”)

Final rule, Manufactured Home Procedural and Enforcement Regulations, 83 Fed. Reg. 57677, 57686 (November 16, 2018) (“This rulemaking incorporates by reference ANSI A119.5-15 and NFPA 1192-15 consensus standards for Recreational Vehicles. The Recreation Vehicle Industry Association (RVIA) sponsors and is accredited to manage the ANSI A119.5 Park Model Recreational Vehicle Standard, which is designed specifically for PMRVs.”)

RV Industry Association (“A Park Model RV (PMRV) is a unique towable RV designed to provide temporary living quarters for recreational, seasonal, camping or travel use. PMRVs (previously referred to as recreational park trailers) are built on a single trailer chassis, mounted on wheels and have a gross trailer area not exceeding 400 square feet in the set-up mode. They are certified by their manufacturers to comply with the American National Standards Institute (ANSI) A119.5 Park Model Recreational Vehicle Standard. PMRVs are most often sited in RV parks or campgrounds for seasonal use. The campground might own the units and rent them to guests, or an individual PMRV owner might site their unit on a space leased from an RV park or campground. PMRVs by definition are not meant to be affixed to real property. PMRVs are neither designed nor intended by their manufacturers to be used as permanent residences.”)