Here, ENT Federal Credit Union (hereinafter “ENT”) granted a loan to Alice Ripley secured by her mobile home. The credit union properly perfected the loan by placing its lien on the certificate of title for the mobile home.

Thereafter, the borrower purchased real estate and pledged a mortgage to Chrysler First Financial Services Corporation (hereinafter “Chrysler”), specifying as collateral the real property and the mobile home.

The mobile home had been built onto the real estate, with a permanent base, after removal of the axle and wheels.

Chrysler argued that its lien was superior to that of the credit union, since the mobile home had become a “fixture” on the real estate and, under the terms of the mortgage, all “fixtures” became collateral of the mortgage itself. A “fixture” is an item or object that is permanently implanted in or on any item of collateral.

Here, the Court held that the mobile home did in fact become a “fixture,” however, the credit union lien would be superior to the subsequent mortgage on the real estate since the credit union had properly perfected its interest prior to the mortgage. ENT Federal Credit Union vs. Chrysler First Financial Services Corporation, (Case No. 90CA2019).

Author: Charles R. Harroun, Attorney at Law