HECM Test (Home Equity Conversion Mortgage) HUD Reverse Mortgage Counseling Certification 400 Questions : | 100% Pass Guaranteed | Graded A+

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HECM Test (Home Equity Conversion Mortgage) HUD
Reverse Mortgage Counseling Certification 400 Questions :
| 100% Pass Guaranteed | Graded A+


1. What is the minimum age requirement for a borrower to qualify for a Home Equity Conversion


Mortgage (HECM)?


A. 55 years old


B. 60 years old


C. 62 years old


D. 65 years old



☑ Correct Answer: C


☑ Explanation: The minimum age requirement for a HECM loan is 62 years old. All borrowers on

the loan must be at least 62 years of age. Options A, B, and D are incorrect age requirements.




2. The Home Equity Conversion Mortgage (HECM) program is insured by which federal agency?


A. The Department of Veterans Affairs (VA)


B. The Federal Housing Administration (FHA)

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C. The Federal National Mortgage Association (Fannie Mae)


D. The Federal Home Loan Mortgage Corporation (Freddie Mac)



☑ Correct Answer: B


☑ Explanation: The HECM program is insured by the Federal Housing Administration (FHA), which

is part of the U.S. Department of Housing and Urban Development (HUD). Options A, C, and D are not the


insuring agency for HECM loans.




3. What is a reverse mortgage?


A. A loan that must be repaid in monthly installments over 30 years


B. A loan against the value of a home that does not require repayment as long as the borrower lives in


the home


C. A government grant for home repairs


D. A tax-free gift from the government



☑ Correct Answer: B


☑ Explanation: A reverse mortgage is a loan against the value of a home that allows

homeowners aged 62 and older to convert a portion of their home equity into cash. The loan does not

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require repayment as long as the borrower continues to live in the home as their primary residence.


Options A, C, and D are incorrect descriptions.




4. The HECM loan becomes due and payable when which of the following events occurs?


A. The borrower turns 75 years old


B. The borrower's home appreciates in value


C. The borrower no longer lives in the property as their primary residence


D. The borrower's property taxes decrease



☑ Correct Answer: C


☑ Explanation: A HECM loan becomes due and payable when the last surviving borrower no

longer lives in the property as their primary residence. Other due and payable events include failure to


pay property taxes or insurance, or failure to maintain the property. Option A is incorrect (age does not


trigger repayment), B is incorrect (appreciation does not trigger repayment), and D is incorrect.




5. Which of the following would cause a HECM loan to become due and payable?


A. Required repairs were not completed


B. Homeowners insurance was not renewed and therefore cancelled

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C. Property taxes were not paid


D. All of the above



☑ Correct Answer: D


☑ Explanation: All of the listed events—failure to complete required repairs, failure to maintain

homeowners insurance, and failure to pay property taxes—are conditions of default that can cause a


HECM loan to become due and payable. Options A, B, and C are all correct, making D the correct answer.




6. What is the maximum claim amount for a HECM loan?


A. The full appraised value of the home


B. The lesser of the home's appraised value or the FHA mortgage limit


C. 80% of the home's appraised value


D. The amount of equity the borrower has in the home



☑ Correct Answer: B


☑ Explanation: The maximum claim amount is the lesser of the home's appraised value or the

FHA mortgage limit for the county where the property is located. Option A is incorrect because the FHA


limit may be lower than the appraised value. Options C and D are not the definition of maximum claim


amount.