Multiple HUD Regulations for Permanent Foundations on Manufactured Homes

Written By: Paul Hayman, P.E.

There is more than one regulation that determines the requirements for foundations on manufactured homes. There is the September 1996 Permanent Foundations Guide for Manufactured Homes (PFGMH), which is an engineering document that is commonly used by engineers in designing and certifying foundations on manufactured homes. There is also the HUD Handbook 4150.2 Valuation Analysis for Home Mortgage Insurance for Single Family One- to Four- Unit Dwellings July 1, 1999. This is the manual that appraisers use in evaluating manufactured homes. Engineering Certifications generally certify compliance only with the PFGMH, not HUDHandbook 4150.2, and this sometimes creates confusion.

For example, HUD 4150.2 requires that the running gear and towing hitch (and usually also the wheels and axles) be removed, but the PFGMH does not address this. Some lenders find it confusing that the tongue could still be attached but the foundation is certified by the engineer as HUD compliant. Also, HUD 4150.2 requires that the HUD tag be attached and visible. If the HUD tag is missing, the loan is in jeopardy as the handbook mandates that the appraiser reject the property. Sometimes a replacement document can be obtained at http://www.ibts.org/certification_label.shtml. This is the website of the Institute of Building Technology and Safety. This verification is issued by IBTS, HUD's contractor, and is acceptable in lieu of a replacement label. Labeling information for all homes built under the Federal Program since June 15, 1976 is maintained by IBTS.

HUD Handbook 4150.2 references the PFGMH and mandates compliance with it. “The home must beerected on a permanent foundation in compliance with the Permanent Foundation Guide for Manufactured Housing. All proposed or newly constructed manufactured homes must meet the standards set forth in the Permanent Foundation Guide. A licensed professional engineer's seal and signature (certification) is required to indicate compliance with the Foundation Guide. The lender should furnish the appraiser with a design engineer's inspection of the foundation prior to the appraisal.” Note that HUD 4150.2 requires that the engineering certification be completed prior to the appraisal.

This is the opposite of what most lenders do, but it hasn’t seemed to create a problem for the lender. It does create a problem for the appraiser as he is required to do the following: ” The appraiser must inspect the crawl space for the following: poured in place concrete footings placed below the frost line supporting the manufactured home carriage frame, tie-downs anchored to the footings, protection from the elements and enclosed with material imperious to rot and infestation and perimeter foundation-type construction with footings extended below the frost line.” Most appraisers would have a hard time verifying this without the engineers input. And why would they want to accept the liability for this when they don’t make an extra dime for it?

What is confusing is that HUD 4150.2 requires the appraiser to verify foundation features that are not required by the PFGMH. “Tie-downs anchored to the footings” are not absolutely required by the PFGMH. THE PFGMH appears to require concrete anchors for vertical anchorage while not requiring concrete anchors for lateral anchorage, but it is not very clear on exactly what it is requiring. HUD 4150.2 also requires the appraiser to verify “perimeter foundation-type construction with footings extended below the frost line,” which the PFGMH does not require.

All this makes it difficult for a lender to know what to do. Just keep in mind that the engineer has his requirements and the appraiser has his own separate requirements. It is usually better for all if the lender lets the engineer decide what the permanent foundation requires and lets the appraiser decide the rest.

About the Writer. Paul Hayman, P.E., is owner of Hayman Residential Engineering Services, Inc. His company specializes in providing engineering certificates in 49 states. He can be reached at hresanswers@hayman-res.com or www.hayman-res.com.

SOURCE: Published by NAMP Publishing Group, a division of the National Association of Mortgage Processors (http://www.MortgageProcessor.org)