Under a so-called detitling statute, signed into law last month, manufactured homes can be classified as real property rather than personal property. The law is aimed primarily at buyers of new mobile residences who also own their land.

"South Carolina is now catching up with changes in the housing market," said Mark Dillard, executive director of the Manufactured Housing Institute of South Carolina, a Columbia-based trade group representing more than 1,000 industry members.

Previously, the state issued paper titles for all factory-built homes, placing them in the same category as automobiles, boats and other personal property.

The rub for manufactured home buyers was that Fannie Mae and Freddie Mac buy only loans secured by real property.

The two government-chartered giants make mortgage money available by purchasing home loans from lenders.

The reason for their policy is tethered to the mobile-home industry's "image issue -- that you could pick the house up and take it in the middle of the night," said Burch Antley, spokesman for the MHI.

Without the Fannie Mae and Freddie Mac safety net, banks, thrifts and other housing lenders would agree to finance factory-built homes only with higher-interest, consumer-type loans.

Al Randall, a former MHI chairman and an account executive at Charleston-based First Financial Holdings Inc., said manufactured home owners in South Carolina typically pay 2 percentage points more in annual interest than owners of conventional "site-built" houses.

Now, with a system in place to "retire" manufactured-home titles at the time of purchase, the structure and underlying land can be combined as a single property and qualify for a traditional mortgage. Those loans are suitable for the likes of Fannie Mae, which bundles them together and sells them as securities on Wall Street.

"If the loan is eligible for sale to Fannie Mae, it means more affordable financing will be available for consumers," said Alfred King, a spokesman for the mortgage buyer.

Whether owners of older mobile-homes can take advantage of the new law by refinancing their loans remains to be seen, Randall said.

"Most of that is going to de- pend on the lending institution, whether they want to look at the ing or not," he said.

The legislation is not expected to have any effect on property taxes because local governments already assess manufactured homes at the same rates as conventional residences, said Burnet R. Maybank III, director of the state Department of Revenue.

"The bill is totally transparent in terms of taxes," Maybank said Friday. "It won't raise taxes or lower taxes."

The MHI said more than 80 percent of the manufactured homes sold in the state "go to the home site and stay there." The U.S. Census in 2000 found that mobile homes make up one in five South Carolina residences, or 355,000 families, the highest rate in the nation.

The legislation was sponsored by Rep. Bill Cotty of Richland County, Rep. Jay Lucas of Darlington County and Sen. Larry Martin of Pickens County. It was signed into law July 18 by Gov. Mark Sanford.

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