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Manufactured Housing Communities

The Implications of the Federal Gramm-Leach-Bliley Act on the Manufactured Housing Industry

During recent years, most individuals have been inundated with privacy disclosures from banks, insurance providers, credit card issuers, and other businesses. The Gramm‑Leach‑Bliley Act (the "GLBA") is a federal law that requires various types of businesses to provide their written privacy policy to their customers. The GLBA, as currently written, applies to numerous businesses associated with the manufactured housing industry.

The original intent of the GLBA was to target banks, credit card issuers, insurance businesses and similar financial institutions. Unfortunately, the legislation was written with such broad language that it has created confusion as to the scope of businesses to which it applies. The GLBA imposes disclosure obligations on any business classified as a financial institution. The confusion stems from the overly broad definition of the term "financial institution", which is essentially any business that is significantly engaged in financial activities, including but not limited to, extending credit, servicing loans, lending money, insuring against loss, providing financial investment services, leasing real property on a non‑operating basis, collection services, and similar activities Since this is such a new law, there is very little guidance available to determine who falls within the guidelines for complying with the GLBA.

Manufactured home brokers, dealers, lenders, insurers and others who are involved in the retail and financial end of the industry will generally be required to comply with the GLBA. For example, the following types of activities are just some of the activities that can subject a business to the requirements of the GLBA:

  • extending credit,

  • servicing loans for your own account or for the account of others,

  • issuing credit,

  • processing loan applications for your own account or on behalf of a third party lender,

  • insurance-related services,

  • collections, and

  • other similar activities.

Generally, landlords of manufactured home communities are not subject to the GLBA, provided that they are not directly or indirectly involved in operating, servicing, maintaining or repairing the leased property and common areas. For those landlords that also sell manufactured homes by issuing credit or processing loan applications, the GLBA would apply.

The Federal Trade Commission ("FTC") is the governmental agency that enforces the GLBA. If your business is subject to the GLBA, the law requires you to issue various written disclosures to your customers depending on the particular nature of your business and the manner in which you use information about the customer. The deadline for complying with the initial disclosure requirements was July 1, 2001. If the GLBA applies to your business, and if you have not already complied, you would be well advised to immediately draft and issue the required disclosures. Further, you must continue to comply with the disclosure obligations in the future. If you are uncertain whether the GLBA applies to your business, if you are unsure of the proper type of disclosures to issue or if you have specific questions, you should consult with an attorney knowledgeable of the GLBA.

This article was originally published in 2008.

 
          

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