For the HECM program, FHA defines existing properties as those where construction has
been completed and the property is habitable. For example, if the prospective borrower
occupies a property that has been recently constructed, lenders can ensure that construction is complete and habitable by reviewing the Certificate of Occupancy, or its equivalent, that has been issued by the local jurisdiction. Therefore, lenders are required to ensure that the property, when used as collateral for the HECM, meets the following existing property requirements:

* Serves as the principal residence of the borrower;
* Construction is complete and the property is habitable;
* HECM proceeds are not used to acquire the property; and
* Any loan that financed the construction and/or purchase of the home is satisfied and the HECM assumes the first lien position.

The important thing to remember is that no matter what type of property, in nearly every case it must be the primary residence of the borrower(s). For example, townhomes (attached units) often qualify for FHA HECM financing. In many instances, condominiums are eligible for FHA reverse mortgage financing, provided they meet certain criteria.

On a case by case basis, some proprietary products (those where the lender sets the rules) a second home (not an investment property) may qualify, but the lender will set the parameters for that type of home.

Even a mobile home could possibly qualify, although the borrower must own the land (no lot leases allowed) in addition to meeting other criteria established by FHA.