REVERSE MORTGAGES EXAM QUESTIONS ANSWERED CORRECTLY LATEST UPDATE 2026
Who are reverse mortgages popular products for and why? - Answers Popular for older homeowners
who have equity in their homes and little or no income.
What do reverse mortgages allow people to do? - Answers Allow older homeowners to use equity in
their homes to meet expenses of living or to pay for home improvements
Are borrowers required to repay a reverse mortgage? - Answers They are not required to repay as
long as they continue to live in the home
At what age are reverse mortgages available to? - Answers Borrower must be 62 years or older and
must reside in their home
When must the mortgage be payable in full? - Answers Mortgage must be payable in full when the
home is sold or last surviving homeowner dies
What happens to the Interest in a reverse mortgage? - Answers Interest is charged on the
outstanding balance and added to the debt
What happens to the debt in a reverse mortgage? - Answers it increases with each advancement of
credit and with accrued interest
What are the 3 types of reverse mortgages - Answers Single purpose reverse mortgage
Home Equity Conversion Mortgages
Proprietary Mortgages
Home Equity Conversion Mortgages - Answers Reverse mortgage that are regulated and insured by
HUD. Allow borrowers to receive fixed monthly payments, a line of credit, or a combi of payment and
credit line
What must borrowers complete if they wish to get a reverse mortgage? - Answers Borrowers must
complete counseling with a HUD approved HECM counselor
What is a Single Purpose Reverse Mortgage and who can offer it? - Answers Low cost loans offered to
low income borrowers by state and local agencies or non-profit
What are the specifications of Single Purpose RM - Answers They can only be used for the purpose
specified by the lender such as home improvement or paying property taxes.
Proprietary Mortgages - Answers Private loans and are more expensive but allow homeowners to
borrow more than they can borrow with an HECM
Why might a reverse mortgage become due and payable? - Answers Homeowner:
Dies
moves out of home for longer than a year
Sells the home
Fails to pay property taxes or keep home insured
Fails to maintain or repair home
Declares bankruptcy
Abandons the property
Perpetration of fraud or misrepresentation
Eminent Domain or condemnation proceedings
What additional default clauses can be added to make a reverse mortgage payable? - Answers If the
homeowner:
1. Rents all or a portion of their home
2. Adding a new owner to home's title
3. Taking out any new debt against the home
4. Zoning classification changes
Today what are most reverse mortgages? - Answers Home Equity Conversion Mortgages
What are some other required premiums with HECMs - Answers Annual and upfront Mortgage
Insurance Premiums
How old do you have to be to qualify for an HECM - Answers 62 years old
What residence must the HECM be secured by - Answers Borrower's principal residence
What must a homeowner do with their existing mortgage in order to qualify for a HECM? - Answers
They borrower must pay off the existing mortgage on their home to qualify for an HECM. If money is
still owed, they can qualify, but the reverse mortgage must be used to pay off the indebtedness.
What if the borrower has defaulted on Federal debt? - Answers They will not qualify for a HECM
What must also be completed before qualifying for a HECM? - Answers Applicant must complete a
consumer information session on reverse mortgage loans
Who are reverse mortgages popular products for and why? - Answers Popular for older homeowners
who have equity in their homes and little or no income.
What do reverse mortgages allow people to do? - Answers Allow older homeowners to use equity in
their homes to meet expenses of living or to pay for home improvements
Are borrowers required to repay a reverse mortgage? - Answers They are not required to repay as
long as they continue to live in the home
At what age are reverse mortgages available to? - Answers Borrower must be 62 years or older and
must reside in their home
When must the mortgage be payable in full? - Answers Mortgage must be payable in full when the
home is sold or last surviving homeowner dies
What happens to the Interest in a reverse mortgage? - Answers Interest is charged on the
outstanding balance and added to the debt
What happens to the debt in a reverse mortgage? - Answers it increases with each advancement of
credit and with accrued interest
What are the 3 types of reverse mortgages - Answers Single purpose reverse mortgage
Home Equity Conversion Mortgages
Proprietary Mortgages
Home Equity Conversion Mortgages - Answers Reverse mortgage that are regulated and insured by
HUD. Allow borrowers to receive fixed monthly payments, a line of credit, or a combi of payment and
credit line
What must borrowers complete if they wish to get a reverse mortgage? - Answers Borrowers must
complete counseling with a HUD approved HECM counselor
What is a Single Purpose Reverse Mortgage and who can offer it? - Answers Low cost loans offered to
low income borrowers by state and local agencies or non-profit
What are the specifications of Single Purpose RM - Answers They can only be used for the purpose
specified by the lender such as home improvement or paying property taxes.
Proprietary Mortgages - Answers Private loans and are more expensive but allow homeowners to
borrow more than they can borrow with an HECM
Why might a reverse mortgage become due and payable? - Answers Homeowner:
Dies
moves out of home for longer than a year
Sells the home
Fails to pay property taxes or keep home insured
Fails to maintain or repair home
Declares bankruptcy
Abandons the property
Perpetration of fraud or misrepresentation
Eminent Domain or condemnation proceedings
What additional default clauses can be added to make a reverse mortgage payable? - Answers If the
homeowner:
1. Rents all or a portion of their home
2. Adding a new owner to home's title
3. Taking out any new debt against the home
4. Zoning classification changes
Today what are most reverse mortgages? - Answers Home Equity Conversion Mortgages
What are some other required premiums with HECMs - Answers Annual and upfront Mortgage
Insurance Premiums
How old do you have to be to qualify for an HECM - Answers 62 years old
What residence must the HECM be secured by - Answers Borrower's principal residence
What must a homeowner do with their existing mortgage in order to qualify for a HECM? - Answers
They borrower must pay off the existing mortgage on their home to qualify for an HECM. If money is
still owed, they can qualify, but the reverse mortgage must be used to pay off the indebtedness.
What if the borrower has defaulted on Federal debt? - Answers They will not qualify for a HECM
What must also be completed before qualifying for a HECM? - Answers Applicant must complete a
consumer information session on reverse mortgage loans
