HECM Exam Review |Questions and Verified Answers (New 2023/ 2024 Update)

HECM Exam Review |Questions and Verified Answers (New 2023/ 2024 Update) QUESTION What are the 3 upfront costs for a HECM? Answer: 1. origination fee 2. mortgage insurance premium 3. third party/closing costs QUESTION What recurring costs may be included in a HECM? Answer: servicing fees, annual MIP, & interest QUESTION What fee compensates the lender for the activities involved in setting up the loan? Answer: the origination fee QUESTION What is the maximum origination amount lenders can charge for origination fees? Answer: 2% of the first $200,000 MCA PLUS 1 % of home value over $200,000 ($6000 maximum) QUESTION Lenders may always charge at least this amount of origination on lower value homes...Answer: $2,500 QUESTION What are upfront MIP premiums based on? Answer: the home's value (MCA) QUESTION What is the annual MIP premium based on? Answer: the loan balance QUESTION What is the percent charged for upfront MIP? Answer: 2% of the home's value (?) QUESTION What are loan funds reserved for a specific future purpose? Answer: set-aside QUESTION What are 3 purposes set-asides may be for?Answer: servicing fees, required repairs, taxes & insurance QUESTION What is the maximum disbursement allowed at closing? Answer: the greater of 60% of the Principal limit OR the sum of all mandatory obligations plus 10% of the principal limit Q