HECM Test Exam Questions
and Answers Latest 2025 TOP
RATED A+
mortgage insurance premium - Correct Answer-What is the
mortgage insurance premium? (For a HECM, it is 2 % of the
Maximum Claim Amount plus an Annual Premium of 0.5 % of
the loan balance
origination fee - Correct Answer-What is the origination fee?
(The origination fee must cover all origination activities. HECM
product defines the origination fee as the greater of $2,500 or
two percent of the maximum claim amount of the mortgage,
up to a maximum claim amount of $200,000, plus one percent
of any portion of the maximum claim amount that is greater
than $200,000. The total loan origination fee may not exceed
$6,000. The lender may accept a lower origination fee when
appropriate.)
regular review for loans - Correct Answer-The HECM
adjustable interest rate will adjust every month or year
,depending on the period selected by the borrower. This is also
the case with many other reverse mortgage products. In the
case of a HECM, the lender will notify you of a change at least
25 days before the new rate is charged to the loan. It is your
responsibility to review this notice.
The lender is required to send a statement that summarizes
your mortgage activity. Statements for HECMs are issued at
least annually and may be issued more frequently by some
lenders. You should review this statement when you receive
it.
open-end and closed-end - Correct Answer-Most products
allow "open-end" credit: you may pay back some of the loan
balance and then reborrow the money at another time. ¾
Other products have "closed-end" credit, meaning that you
may not re-borrow principal that is prepaid on the loan.
If you are considering using your reverse mortgage to
purchase an annuity, here are some facts and features you
need to know about: - Correct Answer-
follow up - Correct Answer-Verbal follow up - 60 days after
the counseling session (in person or telephone)
, • Review information discussed during the counseling session
and the materials provided to the client, and • emphasize that
client may call at any time with questions or concerns. Follow
up letter or an e-mail (if unsuccessful at verbal follow up)
Request that client contact the housing counseling agency no
later than 30 days from the date sent, to help the agency
assess if
• additional client services are necessary to assist the client in
achieving his/her housing goals, or • the agency should
terminate counseling services.
follow up after emergency counseling - Correct Answer-Client
Follow Up (cont.)
Follow-up to Emergency Counseling, if applicable
When counselor performs emergency counseling and the
client receives the information packet during or after the
counseling session, wait 24 to 48 hours to contact the client so
that the client has time to review the materials and consider
his/her options. Emphasize that the client may call at any time
with additional questions or concerns. Close-out or Outcome
letter
The objective of reverse mortgage counseling is to educate
clients on - Correct Answer-how reverse mortgages work and
their implications
and Answers Latest 2025 TOP
RATED A+
mortgage insurance premium - Correct Answer-What is the
mortgage insurance premium? (For a HECM, it is 2 % of the
Maximum Claim Amount plus an Annual Premium of 0.5 % of
the loan balance
origination fee - Correct Answer-What is the origination fee?
(The origination fee must cover all origination activities. HECM
product defines the origination fee as the greater of $2,500 or
two percent of the maximum claim amount of the mortgage,
up to a maximum claim amount of $200,000, plus one percent
of any portion of the maximum claim amount that is greater
than $200,000. The total loan origination fee may not exceed
$6,000. The lender may accept a lower origination fee when
appropriate.)
regular review for loans - Correct Answer-The HECM
adjustable interest rate will adjust every month or year
,depending on the period selected by the borrower. This is also
the case with many other reverse mortgage products. In the
case of a HECM, the lender will notify you of a change at least
25 days before the new rate is charged to the loan. It is your
responsibility to review this notice.
The lender is required to send a statement that summarizes
your mortgage activity. Statements for HECMs are issued at
least annually and may be issued more frequently by some
lenders. You should review this statement when you receive
it.
open-end and closed-end - Correct Answer-Most products
allow "open-end" credit: you may pay back some of the loan
balance and then reborrow the money at another time. ¾
Other products have "closed-end" credit, meaning that you
may not re-borrow principal that is prepaid on the loan.
If you are considering using your reverse mortgage to
purchase an annuity, here are some facts and features you
need to know about: - Correct Answer-
follow up - Correct Answer-Verbal follow up - 60 days after
the counseling session (in person or telephone)
, • Review information discussed during the counseling session
and the materials provided to the client, and • emphasize that
client may call at any time with questions or concerns. Follow
up letter or an e-mail (if unsuccessful at verbal follow up)
Request that client contact the housing counseling agency no
later than 30 days from the date sent, to help the agency
assess if
• additional client services are necessary to assist the client in
achieving his/her housing goals, or • the agency should
terminate counseling services.
follow up after emergency counseling - Correct Answer-Client
Follow Up (cont.)
Follow-up to Emergency Counseling, if applicable
When counselor performs emergency counseling and the
client receives the information packet during or after the
counseling session, wait 24 to 48 hours to contact the client so
that the client has time to review the materials and consider
his/her options. Emphasize that the client may call at any time
with additional questions or concerns. Close-out or Outcome
letter
The objective of reverse mortgage counseling is to educate
clients on - Correct Answer-how reverse mortgages work and
their implications
