Home Equity Conversion Mortgage Counseling

The Home Equity Conversion Mortgage (HECM), available through many lenders, while NeighborWorks is not a HECM lender, we do provide the mandatory 3rd party counseling session. The FHA tells HECM lenders how much they can lend you, based mainly on your age and your home's value. The HECM program limits your loan costs, and the FHA guarantees that lenders will meet their obligations. You must discuss the HECM program with a counselor from a HUD-approved counseling agency, such as our NeighborWorks counselor. There is a $150.00 fee for this counseling service (fee may be waived based on affordability).

HECM loans generally provide the largest loan advances of any reverse mortgage. Often they provide a lot more cash than any other program. HECMs also give you the most choices in how you can have the cash paid to you. The money you get from a HECM can be used for any purpose. Although they are not cheap, HECM loans can be much less costly than the other reverse mortgages that can be used for any purpose.Did you know that you can possibly purchase a smaller home with a HECM?


Repaying a HECM

You must repay a HECM loan in full when the last surviving borrower dies or sells the home. It also may become due if:
  • You allow the property to deteriorate, except for reasonable wear and tear, and you fail to correct the problem; or
  • All borrowers permanently move to a new principal residence; or
  • The last surviving borrower fails to live in the home for 12 months in a row because of physical or mental illness; or
  • You fail to pay property taxes or hazard insurance, or violate any other borrower obligation.

Who is Eligible

  • You, and any other current owners of your home who live in your home as a principal residence
  • At least one borrower has to be age 62 or older
  • Your home must be a single-family residence in a 1- to 4-unit dwelling, a condominium, or part of a planned unit development (PUD). Some manufactured housing is eligible, but cooperatives and most mobile homes may not be
  • Your home must be at least one year old and meet HUD's minimum property standards, but you can use the HECM to pay for repairs that may be required; and
  • You must discuss the program with a counselor from a HUD-approved counseling agency. NWGF does not provide HECM loans, however, we do the mandatory 3rd party counseling session.

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