From eligible home types to taxes and insurance, here’s what homeowners need to know before applying for a reverse mortgage.
Let’s talk about your home. It’s where you’ve made memories, celebrated milestones, and built traditions. But over time, your home can become something more: a valuable financial resource.
A reverse mortgage allows eligible homeowners to convert a portion of their home equity into income tax-free cash1 that can help supplement retirement income, cover healthcare costs, or support the lifestyle they want to enjoy. But before exploring how much you may qualify for, it’s important to understand whether your property is eligible.
Here’s what you need to know.
What Types of Homes Qualify for a Reverse Mortgage?
According to the U.S. Department of Housing and Urban Development (HUD), the following property types may qualify for an FHA-insured Home Equity Conversion Mortgage (HECM) — the most common type of reverse mortgage:
- Single-family homes (the most common eligible property type)
- Single-family homes with a manufactured home ADU
- Multi-family homes with 2–4 units, provided one unit is your primary residence
- Manufactured homes that meet FHA requirements
- FHA-approved condominiums and site condominiums
- Condominium units eligible for FHA Single Unit Approval
- Townhomes and Planned Unit Developments (PUDs), attached or detached
- Mixed-Use Properties (properties with at least 51% residential square footage)
- Leasehold Interests
- Modular homes and some log homes
- Newly constructed homes with a Certificate of Occupancy issued prior to closing
Vacation homes, second homes, and properties with primarily income-producing land — such as farms — are generally not eligible. To qualify, the property must serve as your primary residence.
But what if your home doesn’t meet standard HECM guidelines — or you want to potentially access more of your equity? That’s where Platinum by Longbridge may provide additional flexibility.
What Is Platinum — and How Is It Different From a HECM?
Platinum is a proprietary jumbo reverse mortgage designed for homeowners whose properties or financial goals fall outside traditional HECM guidelines.
While both programs allow homeowners to access home equity, Platinum offers expanded eligibility and higher lending limits.
Here’s a high-level comparison:
Age Eligibility
- HECM: You must be age 62 or older
- Platinum: Available to eligible homeowners age 55 and older2
Loan Amounts
- HECM: Subject to FHA lending limits
- Platinum: Loan amounts available up to $4 million3
Costs
Compared to a HECM, Platinum features:
- Lower upfront costs
- No mortgage insurance premiums
This can potentially save you thousands over the life of the loan.
Property Eligibility
Platinum also allows for a broader range of eligible property types, including higher-value homes that may not qualify for a HECM.
In addition to the HECM-eligible property types listed above, Platinum also allows:
- Non-FHA Approved Condos
- Properties with Solar Leases
- Legal Non-Conforming Properties
If your home doesn’t qualify for a HECM, Platinum may provide another path to accessing your home equity.
Does a Reverse Mortgage Need to Be the Primary Lien?
Yes. For both HECM and Platinum reverse mortgages, the reverse mortgage must hold first lien position in order to qualify. If you currently have a traditional mortgage, reverse mortgage proceeds are typically first used to pay off that loan, eliminating any existing mortgage balance.
The remaining funds are yours to use as you wish.
What Are the Occupancy Requirements?
For both HECM and Platinum, the home must be your primary residence — though each program defines that requirement slightly differently.
Under a HECM, your primary residence is the home where you live for the majority of the calendar year. Platinum defines primary residence more specifically:
- You must occupy the home for at least 183 days per calendar year
- You must move into the property within 60 days of closing
It’s important to note that failure to meet occupancy requirements may cause the loan to become due and payable. This can happen if:
- You live outside the home for the majority of the year for non-medical reasons, or
- You are absent from the home for more than 12 consecutive months for healthcare-related reasons
Do You Have to Keep Up With Taxes and Insurance?
Yes. Under both HECM and Platinum guidelines, you must remain current on:
- Property taxes
- Homeowners insurance
- Flood insurance (if applicable)
- HOA or condominium association fees (if applicable)
What Condition Does Your Home Need to Be In?
For both HECM and Platinum, the home must be:
- Structurally sound
- Safe
- Properly maintained
HECM properties must meet FHA requirements, and any major issues affecting health, safety, or structural integrity generally must be repaired before closing.
Platinum follows similar standards and also requires compliance with applicable state and local building codes.
If repairs are needed, your lender will explain what must be addressed before the loan can move forward.
How Much Home Equity Can You Access?
Whether your property qualifies for a HECM or Platinum reverse mortgage, the amount of available equity plays a major role in determining how much you may be eligible to receive.
Want to see how much money you could access? Use our reverse mortgage calculator for a no-cost, no-obligation estimate, or contact the Longbridge team to explore which program may be right for you.