HECM study guide Questions and
Answers| Latest Update
TALC rates generally are greatest when borrowers live NeighborWorks HO111 Course
Manual - Tab 9: HOW MUCH DOES IT COST? PART 3: COMPARING LOANS AND WEIGHING
COSTS; TALC rates are highest in the early part of the loan and tend to be lower the longer the
loan is in place. This is because the cost of the loan is spread out over a longer period of time
A home located in a Planned Unit Development (PUD), such as a golf-course community, may be
eligible for a HECM HECM Counseling Protocol 5.C.2.b
Mr. Behm's home is valued at $200,000. His home needs a new roof, a new furnace, and
electrical work which will cost $25,000. Which of the following is true? HECM Counseling
Protocol 5.C.3.b; HECM borrowers whose properties do not meet FHA standards may obtain a
HECM and THEN complete the required repairs provided that the cost of the repairs are not
greater than 15% of the maximum claim amount. The cost of the required repairs is 12.5% so
Mr. B does NOT need to make some of the repairs before closing. 150% of the estimated cost of
repairs must be set aside to complete the repairs. 150% of $25,000 is $37,500 so that is the
amount that will be set aside
A client who is disabled due to medical malpractice reports that he has $4,000 per month
income from a settlement, and $50,000 in a retirement account. The counselor is required to:
HECM Counseling Protocol 5.B.7.c; The Protocol specifically requires Benefits CheckUp be
completed if the borrower's is below 200% of poverty level or if the borrower is disabled. This is
specifically stated in the HUD regulations
The initial interest rate on an adjustable-rate HECM is based on: NeighborWorks HO111
Course Manual - Tab 8, HUD Handbook 7610.1 p. 101
Answers| Latest Update
TALC rates generally are greatest when borrowers live NeighborWorks HO111 Course
Manual - Tab 9: HOW MUCH DOES IT COST? PART 3: COMPARING LOANS AND WEIGHING
COSTS; TALC rates are highest in the early part of the loan and tend to be lower the longer the
loan is in place. This is because the cost of the loan is spread out over a longer period of time
A home located in a Planned Unit Development (PUD), such as a golf-course community, may be
eligible for a HECM HECM Counseling Protocol 5.C.2.b
Mr. Behm's home is valued at $200,000. His home needs a new roof, a new furnace, and
electrical work which will cost $25,000. Which of the following is true? HECM Counseling
Protocol 5.C.3.b; HECM borrowers whose properties do not meet FHA standards may obtain a
HECM and THEN complete the required repairs provided that the cost of the repairs are not
greater than 15% of the maximum claim amount. The cost of the required repairs is 12.5% so
Mr. B does NOT need to make some of the repairs before closing. 150% of the estimated cost of
repairs must be set aside to complete the repairs. 150% of $25,000 is $37,500 so that is the
amount that will be set aside
A client who is disabled due to medical malpractice reports that he has $4,000 per month
income from a settlement, and $50,000 in a retirement account. The counselor is required to:
HECM Counseling Protocol 5.B.7.c; The Protocol specifically requires Benefits CheckUp be
completed if the borrower's is below 200% of poverty level or if the borrower is disabled. This is
specifically stated in the HUD regulations
The initial interest rate on an adjustable-rate HECM is based on: NeighborWorks HO111
Course Manual - Tab 8, HUD Handbook 7610.1 p. 101
