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MHRF Defined
The purpose of the Manufactured Home Recovery Fund (MHRF) is to reimburse actual and direct losses up to $75,000 for any person who has sold or purchased a manufactured home/mobilehome for personal or family residential use or investment purposes, and who has suffered a loss due to:
- Failure to honor warranties or guarantees;
- Fraud or willful misrepresentation related to any financial provision;
- Fraud or willful misrepresentation of the kind or quality of the product sold or purchased;
- For conversion (the unlawful appropriation of the property of another);
- A willful violation of any other provision of the Health and Safety Code, Part 2 – Mobilehomes-Manufactured Housing Act of 1980, including the provisions regulating escrow accounts;
- A violation of the Civil Code, Title 1.7, Chapter 3, beginning with section 1797 – Mobilehome Warranties (for new manufactured homes).
The MHRF is intended as a source of last resort recovery for consumers. Therefore, applicants may qualify to file a claim against the MHRF for their actual and direct loss only after obtaining a final court judgment against the violator, or after being harmed by a Department licensed salesperson, dealer, manufacturer or a individual or entity who is, or has been, the subject of a bankruptcy proceeding or otherwise deemed judgment proof.
The OL Program administers the MHRF by collecting and depositing fees into the Fund which are charged to manufactured housing dealers and salespersons at the time of licensing. Additional revenue is generated for the Fund through a fee charged for each sale of a manufactured home reported to the Department. When the balance in the MHRF exceeds one million dollars ($1,000,000) on January 1 of any year, the Department may reduce the fee charged for each sale of a manufactured home.
The OL Program provides information and claim applications to the public regarding the MHRF. Each claim is reviewed/investigated by the program staff. Approved claims are forwarded to the Department's Legal Affairs Division for final approval. Approved claims are then submitted to the State Controller's Office for payment.