Definition: An FHA-insured reverse mortgage for eligible homeowners that converts home equity into loan proceeds, subject to program requirements.
Example
An eligible homeowner uses a HECM to receive funds while continuing to own and occupy the home.
Keep the distinction clear
A HECM is one type of reverse mortgage. The borrower still has obligations, including property charges, maintenance, and occupancy; it is not free money or an automatic transfer of ownership to the lender.
Related terms
Reverse Mortgage · Equity · Federal Housing Administration (FHA)
Keep studying
References: HUD: Home Equity Conversion Mortgages
Comments
0 comments
Article is closed for comments.