Make manufactured housing a fair deal

The manufactured-housing industry markets mobile homes as an affordable option. But the process of purchasing and installing the homes jeopardizes the buyers’ financial as well as physical safety. Over the past three years, Consumers Union, publisher of Consumer Reports, with support from the Ford Foundation, has examined the manufactured housing industry. Some of the most important findings are in the following areas:


GETTING THE REAL PRICE

Manufactured homes don’t look at all like trailers anymore, but the sales pitch harks back to a 1950s car lot, before mandatory sticker pricing. Sammy J. Huey of Monahans, Texas, knows. When he was shopping for a manufactured home in spring 2003, Huey, a shop foreman at an oil-service company, found that the dealerships he visited didn’t have prices posted. And one dealer refused to give him a price until he had a chance to check Huey’s credit to see what he could afford.

Even the dealership from which he finally bought his home was vague about the price. “They’d say, ‘It’s about this’ and ‘It’s about that,’ but ‘about’ is a couple of thousands of dollars higher,” Huey says. He ended up paying thousands more than the teaser price discussed earlier in the purchase process.

Stories like that are all too common. Even worse, the CU study found significant variations in the prices paid for exactly the same home. Because dealers don’t display their prices, shopping around is unnecessarily difficult. Federal law has mandated sticker prices on autos since the late 1950s to help consumers comparison shop. Why not do the same for manufactured-home buyers?

Sticker prices would make it easy to see the cost of options as well as to compare prices among dealers. Independent lenders already demand invoice information from dealers to establish the value of the collateral. That information should also be provided to the consumer before the sale. While sticker prices aren’t the answer to all of the industry’s woes, they address a major problem.


PAYING TOO MUCH

Inflated dealer prices can turn into quick depreciation once the home is installed. Consumers who pay too much for a home can end up with “negative equity,” owing more on their loan than the home is worth. In the last decade alone, that has led to repossession and financial failure for hundreds of thousands of families. Each one of those families lost its home and its creditworthiness. Home-purchase failures such as these disrupt communities as families move and properties disappear from the tax rolls.


FAULTY INSTALLATION

A mobile home is inspected in the factory, but a lot can go wrong during installation. Consumers should resist pressure from dealers to sign off on the loan before installation and inspection, and inspection should be mandatory.

Post-installation inspections are particularly important in areas subject to hurricanes, where building codes require additional anchorings and tie-downs. States prone to high winds should develop programs to help low-income and elderly residents inspect and tighten or replace degrading straps. Tornado shelters should be made available in mobile-home parks and other areas where there is a high density of manufactured homes.

then	& now

1983		2005
“Computers. Should you take one into your home?” It seems quaint now, but we asked the question in 1983. Was spending up to $3,000 for a home computer worth it? Or would it end up in the attic, next to the Crock-Pot and CB radio? For answers, we had surveyed a group of our computer-using readers. They said that they spent an average of about 15 hours a week on the computer. Learning to program and word processing were popular uses, and kids used it the most--for games. The Osborne I, at left, intended for shuttling between home and office, weighed about 25 pounds. The 6.2-pound Toshiba laptop at right goes anywhere and can process data at 500,000 times the speed of the Osborne.