Reverse Mortgage Guidelines For Manufactured Homes

A few weeks ago I received an email from someone with questions about manufactured housing.  Below is a copy of the email:

I am trying to help my mother select a used manufactured home in a senior community which will qualify for a reverse mortgage when she needs one down the road. I have searched everywhere, but haven’t found the HUD rules for which ones qualify and which don’t. The HUD website only states that some qualify. Of the 2 reverse mortgage brokers that I have spoken to, one has mentioned the removability of the axle, the other a manufactured after 6/15/76 date. I’d really like to get a look at those rules myself.

I sent an email to JB Nutter regarding the question and Mark Bradford gave me a response.  Below are HUD’s list of requirements for eligible Manufactured Homes and Mark’s response:

Advertisement
  1. At least 400 square feet minimum floor area
  2. Built after June, 15 1976, to the Federal Manufactured Home Construction and Safety Standards as evidenced by an affixed certification label.
  3. Property is classified and taxed as real estate and is designed to be used as a dwelling with a permanent foundation built to FHA requirements.
  4. Built and remains on a permanent chassis.
  5. Mortgage covers both the unit and its site, and has a term of not more than 30 years from date that amortization begins.
  6. Finished grade beneath home is at or above the 100-year flood elevation. 

Basically, they have to be at least 400 sq. feet, and built after June 15th, 1976.  You then have to have a structural engineer inspect the foundation, and make sure that it complies to FHA specifications.  If it isn’t, then it has to be changed to conform.   If it is, then you get the report from the engineer stating that it complies and you are good to go.  The appraiser will also verify it has the correct tags and so forth. 

It also must be tied down to a permanent foundation the way the FHA wants it.  You may want to contact a structural engineer that conducts those types of inspections, if you want more specifics on that and/or an FHA appraiser that is familiar with them.

I have done several manufactured homes and they almost never are tied down correctly and have to be done so.  Another thing is, that if the manufactured home is moved from it’s original placement, it becomes permanently ineligible to be insured by the FHA, so you will have to be careful if you buy a used manufactured home. 

If you buy the used home and move it to another site, you will not be able to do a HECM Reverse mortgage, under the current rules.  The other thing you have to look out for, and this is addressed in the other attachment, is that if it is in a flood zone, then the finished grade beneath the home, must be above the 100 year flood plane.  This condition is satisfied with a survey.  I have ran into this before also, and the finished grade had to be changed to comply with this condition.

Thanks Mark!

If you have any other manufactured housing experience, leave your comments below.

Join the Conversation (38)

see all

This is a professional community. Please use discretion when posting a comment.

  • Mark has it pretty close, but I don’t know about the 400sq ft. Rule. As far as I know it must be a double wide or greater and has nothing to do with sq ft. The Hud cert. Tags are also necessary. They are a real pain.

    Best,

    Andrew

  • Make sure the park is not considered Condoland. Currently qualifying mobilehomes in a park deemed as Condoland are not eligable for a reverse mortgage. This is an issue I have ran into before here in California.

  • The Cert tag must be physically able to be photographed as part of the appraisal/engineering inspection. It can never have been moved, i.e., it must have gone from the manufacturer to the current permanent location. (It cannot have come from a dealer site to the location. HUD will count this as being moved.)

    • This is from the FHA min standards website.

      “The only movement acceptable for manufactured
      homes is from the factory to the dealer and then to the site. Once there, it
      must remain. It may be jacked up to have a permanent foundation installed”

      • i would like to know WHY is this a rule . i had my home and 9 ac apprised at 155,000.00. i did all the things this mortgage company told me to do . i had to get a perment fondation put under it and get it approved ……a apprisal…. surveyed now they say because it was moved from another lot not the dearler it will not qualtify for a reverce mortgage . its worth what its worth . WHY ?

  • I maybe getting this condition confused with a different type of property but I also thought you had to be the original owner of the home. So since she is buying it (second owner) she wouldn’t qualify. Does anyone else know what I am referring to?

  • Whaaattt!?!?!?! Andrew said “I don’t know about the 400sq ft. Rule. As far as I know it must be a double wide or greater and has nothing to do with sq ft.”

    Heck, I thought it must be a TRIPLE wide with at least 290sf with an inground pool to keep cool in the summer time. LOL (yes, Nutter has it correct – single wide w/ 400+ sf …plus the other facts)

    It will be nice when NRMLA gets their professional RMS certification launched as we all need to be on the same page with the facts. We are the RM experts here – yes?

    Tim Linger, CSA, CLTC, RMS

  • The main point to get across to this person is that the vast majority of manufactured homes in parks will not qualify because you do not own the land. There are some parks that have been converted to a condo status, but usually will not qualify because the owner will get a “certificate of ownership share” as opposed to actual title to the space. The fact that the foundation systems will not qualify is secondary. And to Doug Z, you can be the 2nd, 3rd or 4th owner, as long as the unit has not been moved from it’s original site and otherwise qualifies.

    Just a general note to all, I have done about a dozen manufactured homes. Without exception, the borrowers are sincere and very appreciative. Just be sure to qualify the property and the procedure up front with the borrower.

  • My second RM Origination was a manufactured home sitting on the same site, undisturbed by the elements,
    since July 1976: a lovely retired couple who needed
    extra money to remain in their home. They, as I, were astonished the foundation work (and cost) it took to qualify for a RM. First, finding a civil engineeer who will crawl under a “moble home” to check the foundation was a challenge. (I actually called the Sana Ana, Ca (West Coast) Regional Office to discuss this problem. The long time FHA employee said, “Nelson, don’t quote me, but that requirement needs to be changed or updated.
    Most Civil Engineers don’t want to admit they crawl under mobile homes for a living!”) The States of Or and Wa are ahead of HUD/FHA concerning manufactured home foundation requirements. Stringent foundation tie down block rules are only required in the high wind areas of the Coast and along the Columbia River Gorge. Two years later and a number of manufactured RM home loans later, this process is easy; however, one question I always ask the client early in the initial conversation is: “Is this home a manufactured home?”

  • Its not as hard as many of you have indicated.

    – permanent foundation
    – built after 6/15/1976
    – Own the land

    With this they go right through.

    I personally have never heard of the 400 sq feet limit. Although, I also could not image a manufactured home or any home for that matter being less than 400 sq feet…that is crazy. If I were HUD I would make that a requirement for all homes : )

    HAPPY HOLIDAYS EVERYONE!

  • You are correct, David;however, there is a question of what is a “permament”foundation–the homeowner may think He has a “permament” foundation as indicated by those who sold and/or installed his manufactured home; but, it may not be a “permament” foundation according to FHA Code. And,the homeowner has to pay three to five hundred dollars to have a civil engineer verify what kind of foundation, according to FHA Code, it truly is. Recently, I had two manufactured homes which had been installed in 2008 (one on a complete, three feet high, solid cement foundation; the other meeting State Code but not FHA Code) which angered homeowners because they had to endure this extra costly requirement.

  • I have been in the middle of a RM, I was up front at the start that I had a mobile home/Manufactured. That it was moved to my land, and put on a permanent foundation with cinder block skirting. Before it was moved I had it in a mobile home park and you can’t own the land. My father died and I was able to buy the land and move my home. I had it checked out by a engineer and it past the foundation. I have done everything I was told to do. Just 2weeks ago I was told I was being refused, becaused I moved my mobile home. As they say twice. and that it was a used home. Well, the loan officer new that my home was New when I bought it back in 1990, and made to what I wanted inside and out. and it came right from the the manufactor, and not the dealer that I bought it from and was placed in a park, because I wasn’t sure where I wanted to live permanent. My trouble all started, after the FHA Appraiser, did her think. She gave all the wrong informations. I am trying to fight and its hard to find the informations I need. I ran across your web site and what I have read has help me alot.
    Thanks, Denyse / Bend Oregon

  • Denyse,

    I am very sad to inform you that there is no way to do a reverse mortgage on a manufactured home once it has been moved from it’s original setup location. Unfortunately, your Loan Officer, either doesn’t know the guidelines or he did not pay attention to you. There are numerous new comers to the industry who are especially unfamiliar with Government loans. It appears that you have found one. I regret this has happened to you. Unfortunately, there is no way around this guideline. I don’t know if it will fit your situation, but you may want to consider replacing your Loan Officer, sell this home, and use the proceeds as a down payment on another home using the new Reverse Mortgage Purchase Program. I wish you the best. May God Bless You.

    Ralph

  • I have a 24 by 60 foot Darlington mobile home. It was manufactured in 1981 and I bought it new. This home is on a cement slab anchored down. The hitch was taken off when it was moved here in 1983. The home was registered in the Highlands County courthouse as real property and has been taxed accordingly. I have applied for a reverse mortgage from Guardian and have been told that since there is no visible plate on the home FHA will not allow them to continue with the reverse mortgage. I am a widow and I need this mortgage. This home and acreage has been appraised by a FHA approved appraiser at $160,000.00 I have paid for the appraisal and for the counseling. I can not get a response from Guardian. I have called themat 800-682-1577 extension 5966 and left a message. Please let me know what I should do.

    Karyl Glessing

  • Dear Mark:
    Having read the responses on your website, I find that I and my wife are not alone in not being able to obtain a reverse mortgage loan on our manufactured home because of the “twice moved” rule. Does this mean that one could not get a RM loan if he or she bought the home off of a dealers lot, since to move it to a parcel of private land it will have been moved twice: once from the manufacturing plant to the dealer’s lot and then to the private land. Why can’t the loan industry do something by way of convincing the blockheads in congress that, 1) manufactured homes are not ‘mobile homes’, 2) many manufactured homes (ours included) are built with 2X6″ exterior walls (and
    many inside walls) and are every bit as sturdy as a ‘stick’ home, 3)many manufactured homes (such as ours) are better anchored to mother earth that many ‘stick’ homes that qualify for RM loans, and 4) if
    structural integrity is the concern with ‘twice moved’ homes, then why deny manufactured home owners a RM if their home passes inspection by a certified structural engineer? It appears to me that its time for someone
    or some group in the loan/realty industry to go to bat and get this stupid, outmoded rule off of the books so that companies like yours can write reverse mortgages and senior citizens like my wife and me can stop being unfairly discriminated against. What’s holding it up?!
    Respectfully yours,
    Gary Squires
    Eagle Point, Oregon
    [email protected]

    • Gary & Mrs., I have had the exact same experience with a twice moved, after original to dealer moved doublewide. It was 6 months old, place on cement runners with tiedowns, wood with vinyl underskirt in 1997, has a civil engineers report in 2008( 2 engineers said it was beyond requirements in 1997 and is now) but am still unable to aquire the FHA insurance, therefore no reverse mortgage, because of the so called second move. If the home is sound enough for an engineers report after being reset then it should qualify. Who is making up these rules? I believe its someone who never had to live in a manufactured home because they have always had the finances to built a site built home.
      My home is also 2X6 walls and brocade stucco walls thruout, so it is very heavy and sturdy, while most site built homes are 2X4 walls,sheetrock and paint.
      Yes I to am very hot about the problem and in need of some financial help at this time.
      Warning to those who are trying to get the Reverse Mortgage, Read or have someone read every word of the loan companies requirements. I had two mortgage companies tell me that “they” could get the loan thru even though I told them about the second move problem. After I received their documents,I read that they had 6 months or more to get the FHA insurance approved on your loan. If I had taken the money at closing, paid off the first mortgage and spent none of the other and they said “Opps” we couldn't get FHA to issue the insurance, the note would be called due and if I couldn't qualify for a new loan(which I couldn't) they could take my home for the amount of the payoff, which was $20,000 and the appraisal is for $120,000.

  • i want to know why is it that if the home has been moved from one lot to another not a dearlers lot it wont qualifiy . what is the reason for this rule ? bobby

  • i would like to know WHY is this a rule . i had my home and 9 ac apprised at 155,000.00. i did all the things this mortgage company told me to do . i had to get a perment fondation put under it and get it approved ……a apprisal…. surveyed now they say because it was moved from another lot not the dearler it will not qualtify for a reverce mortgage . its worth what its worth . WHY ?

  • My home is in northwestern SC on a one acre lot in a mobile home sub-division. When I bought it, there were no improvements other than a 50’X28′ doublewide unit. Since I have been here, I have added a 10X41 foot addition, a 20X40 foot workshop, a 24X20 Attached two car garage, a 40X41 foot three door barn, 19X12 foot covered front porch, a 10X10 foot rear covered porch,had a brick underpinning installed, both baths have been upgraded by Bathfitters including a walk-in tub with whirlpool jets and mood lighting and the other bath all new toilet, sink and walk-in shower, the carpet was removed and replaced with oak hardwood flooring (1 inch), stainless steel refrigerator -dishwasher – washer – dryer – sink and range, 50 gallon water heater with with continuous cycled hot water, a 4X28 foot side deck for a green house,and landscape improvements to numerous to mention. These improvements were somewhere in the area of $200,000 +. My understanding is that my home is not worth the $31,000 that I owe on it. Can this possibly be true? Can I get a reverse mortgage or refi for an additional 35K?

string(95) "https://reversemortgagedaily.com/2008/12/18/reverse-mortgage-guidelines-for-manufactured-homes/"

Share your opinion