This is another article for our Smart Buyer Series. Another article in the series is Manufactured Home Warranties and How to Properly Handle Issues After the Sell. If you are going to be a future manufactured home buyer, please read both. Knowledge is power after all!
You’ve heard the horror stories of a manufactured home purchase: someone buys a home and it turns out to be a living nightmare. Leaks, faulty plumbing, siding or roofing issues, spotty workmanship. High pressure sales, financing nightmares, installation errors and warranty problems….the list can go on and on. There’s plenty of examples online, all you have to do is search ‘manufactured home complaints’ and you’ll have enough reading material to keep you busy for days.
Still, we need to realize that nothing is perfect. Stick-built homes have a lot of complaints, too, so don’t think it’s just manufactured homes. The home building business is difficult and there’s a lot of factors that can happen between the first nail and the last. One small, seemingly insignificant, error can lead to a multitude of issues down the road and that’s true with any building project.
I will be the first to admit that there are some scammy manufacturers and dealers out there. They haven’t quite grasped the concept of customer service and would rather neglect a current customer to focus on a new sell. That’s the way the business is set up though. Salespeople are rewarded for selling and some will take whatever means necessary to get you to sign on the dotted line. Personally, I think the whole concept of salespeople being paid commissions should have left the way of the dinosaur long ago. It aligns the industry with that of the car business and we all know about the used car salesman. If they want to pretend to be real estate agents then they need to introduce a licensing program to keep the bad apples from continuing to ruin the barrel. The manufactured housing industries identity crisis stems from them trying to be like everyone else and not focusing on what they are and that is where I think most of the issue within the industry lies. If they can just come together and agree on what the industry is about and stop trying to being like everyone else, they may just thrive again. Well, that and start educating the public about the great benefits of the homes and stop pretending the stigma and stereotype doesn’t exist. I digress though..let’s carry on…
Avoiding issues during a manufactured home purchase can be tricky. There’s a lot of details you need to know about. How do you get the best price, the best home and the best experience possible and walk away with a smile? Knowledge is the key! Doing your due diligence and researching as much as possible will reduce headaches and expensive set backs and make the process a more rewarding one in the end.
Of course, some people experience a wonderful manufactured home buying process and speak nothing but positive things about the experience. I don’t want to ruffle feathers but I’ve read the statistics and listened to many stories and some aren’t pretty. There are still good companies out there and they want to help you find your affordable dream home. You have to depend on your research and do your homework to find them though and that’s what this article is all about: giving you a little more information about some issues that people face during a manufactured home purchase.
Know the High Pressure Sales Tactics
This is probably one of the biggest issues facing anyone that is looking to buy a new manufactured home. There’s a mistrust of salesman and there’s a reason for that mistrust; we’ve all heard the stories of the lies, the misrepresentations and the bogus promises that have been made to get a sale finalized and get your signature on the contract as soon as possible. You have to buy the home that suits you, not what the salesman wants to sale you. The first rule you should abide by is to follow your gut. If the salesman is telling you that he will get fired if they don’t write up an application or talk to you in their office, leave. If they offer enticements to sign a contract, leave. If you have a nagging feeling like something isn’t right but you can’t quite put your finger on what it is, leave. It’s really that simple. A true professional will want to help you and they will understand that by helping the buyer they will be helping themselves.
Know the Dealers Profit Margin and Your Budget
Dealers make a profit margin of between 18 to 26% over wholesale price, not including installation costs. You shouldn’t spend more than 28% of your gross monthly income on housing. You must factor in taxes, maintenance and insurance.
Know the Homes Transporters, Installers and Finishing Carpenters
Due diligence is absolutely necessary with this part because most of the complaints and issues stem from transit errors. If you are buying a new home, the transportation and installation is usually added to the price of the home. The dealer can either own the truck and employees the team that will be moving and installing your home or they can just contract another company out.
Ask for a list of current buyers, call them and ask questions about how the home was installed, set up, and connected. You should check the BBB and look online for complaints. Many times the complaints will be filed with the contracting company and not the dealership so make sure to check the contractors name as well as the dealership. If you find several complaints regarding past installations you must speak up. The dealer can’t force you to use a contractor. There’s some red tape that may be encountered with this though. Some manufactures insist that you use their people or your warranty is voided. See? It’s a messy situation and requires a lot of research and due diligence.
The installation of a home can include all or some of the site preparation, utilities connections, and drainage installation. You want the best company possible to handle the home. Improper handling and setup of the home is usually found to be the cause of many issues down the road. Poorly trained or unmotivated employees can cause buckling walls, roof leaks, frame damage and faulty windows and doors. If the home isn’t leveled properly or isn’t tied down properly you could face some serious problems in the future. The installation also includes the joining of double wides which entails a whole lot of finishing touches like carpet, trim, doors, skirting and gutters.
The biggest post-sale complaint on manufactured homes are cosmetic complaints. Things like sticky windows, improperly installed floor covering or trim work that looks like a 2 year old did it. Chances are you are not going to notice all this stuff right away. I personally know a family that had issues with their double wides after they moved in. After a couple of days in the home they started noticing little things, lots and lots of little things that needed fixed. The problem was that they signed a paper stating that the home was to their satisfaction. They didn’t realize what they were signing because the finishing carpenter brought the clipboard out on the last day of set up (with a promise they would be back in a week to finish that skirting) and told them they simply needed to sign to prove they had been there that day. In really small print it also stated that the home had been inspected and no issues were found. That signature ended their ability to get anyone to fix the cosmetic issues that they had. The best advice I can give you is to never sign anything on a clipboard until you read it and know exactly what you are signing!
Know the Warranty
Warranty issues is where the remainder of the complaints for manufactured homes come from. There are 3 types of warranties: manufacturers written warranty, express warranty and statutory implied warranty of merchantability. A written warranty protects you against loss from “substantial defects” which is anything except cosmetic damage. There is a expiration and usually that’s 1 year. If the salesman promised a new deck if you bought last years model then that’s an express warranty. If it persuaded you during your purchasing decision but was not fulfilled then the law was possibly violated and you may be entitled to some type of damage. Implied warranties states the home must be suited for the purpose of which it was designed for. It doesn’t protect against specific defects but it is often the best protection you have. It covers things that the express and written warranties wouldn’t.
Some warranties have too much red tape and too many things that can void them. Some warranties only cover non-cosmetic issues but then go on to state that doors and windows are cosmetic. Some won’t cover any issues that arise from improper set up and installation but it was the dealer that had chosen or recommended the contractor that installed the home. It’s mind boggling! Know your warranty and get the dealer to give you the best warranty possible.
These 4 things are only some aspects that you have to consider when purchasing a manufactured home. If you are buying a used home then there’s a whole other set of things to research. Just a little due diligence and knowledge can make the difference between a happy experience and a bad one.
If you’ve had any issues, whether good or bad, let us know about them in the comment section below. Maybe your story will help someone in the future. Below are some articles I have written about the buying process of mobile homes whether new or used. You should check them out if you are a future homeowner:
As always thank you for reading Mobile and Manufactured Home Living!