Many seniors choose a reverse mortgage as a way of turning the equity in their home into cash that can be used for just about anything they wish. It’s more than just the money, these arrangements are usually the best (and sometimes only) way to allow the elderly homeowner to remain in his or her home for the extent of their life. The money is distributed in either a lump sum or through monthly payments and these funds are not due for reimbursement until the homeowner moves out or passes away.

This is the typical definition for a reverse mortgage with a traditional house and the type of loans that are available using the equity in that house. But what about those homeowners who don’t live in a traditional home but a mobile home instead? Are they eligible to take advantage of this lucrative financial opportunity as well? Turns out that could hinge upon the definition of the particular dwelling in question.

Eligibility Requirements

In order for a mobile home to qualify for consideration of a reverse mortgage loan arrangement, it must meet certain criteria. Unfortunately, the majority of them will not qualify but those that do are typically referred to as “manufactured homes” and these dwellings need to have a Department of Housing and Urban Development (HUD) data plate and official certification. The home in question must also comply with Federal Manufactured Home Construction and Safety Standards.

In order to get that HUD plate and certification, the manufactured home must meet these eligibility requirements:

• The homeowner(s) are age 62 or older.
• The manufactured home is classified as a “double wide” at a minimum of 800 square feet in size.
• The dwelling must rest on a permanent foundation.
• The manufactured home must have been built as of January 1990 and it must have never moved locations.
• The manufactured home must be owned by the same individuals who own the property on which it resides.

Getting a Reverse Mortgage

In this case, it’s called a Home Equity Conversion Mortgage and it applies on all HUD-approved manufactured homes. But in order to meet the qualification to get approved by a lender, the homeowner must have closed any previous mortgage on the property or apply the funds received from the loan towards paying off any current balance in full. The money must also be used toward making repairs, paying down any delinquent taxes or insurance, and covering any fees necessary for the upkeep of the home.

Every applicant must also attend HECM counseling classes to learn how reverse mortgages work and understand the agreement they are entering into with this type of loan. The class will walk the applicant through the qualification requirements, the pros and cons of getting this loan, and help them understand how much money they can receive based on the amount of equity they have built in the home. The money that is paid back will never exceed the value of the manufactured home as recent regulations have forbid this from happening by way of language included in every loan agreement of this nature.