The New Home Equity Conversion Mortgage (HECM)
The Cost: Free to Members |
By Mary E. Loeven and Stephen R. Pepe, JD
In mid-2014, the U.S. Department of Housing and Urban Development's (HUD's) reverse mortgage program, the Home Equity Conversion Mortgage (HECM), looked very different than it does today. Three significant regulatory changes have occurred that NAELA members should familiarize themselves with. These changes include new "financial assessment" underwriting criteria, enhanced non-borrower spouse protections, and new lien seasoning requirements. In addition to these regulatory reforms, some lenders have significantly lowered the costs of obtaining an HECM.
Mary E. Loeven is an HECM for Purchase Specialist at Reverse Mortgage Funding. Stephen R. Pepe, JD, is an HECM Loan Specialist at Reverse Mortgage Funding and a NAELA member. The opinions expressed in this article are those of the authors and are not to be construed as an endorsement by NAELA.
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