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Frequently Asked Questions about: H.E.C.M—(hek-um) Mortgages

What is a Home Equity Conversion Mortgage? Most of the public calls this a “reverse mortgage”. It is a federally-insured mortgage program that allows you to use the equity in your home and turn it into usable cash. As long as you continue to live in your home, you will make NO monthly mortgage payments and do not have to pay the loan back until you leave the house permanently. To qualify you must: Be age 62 or over; and Own your own home and live in it as your principal residence; and Have enough equity in your home or qualify for enough funds from a reverse mortgage to pay off any existing mortgage if there is one.



☼ What if I own my house jointly or in common with others?

All owners of the property must be eligible to receive a HECM mortgage or consent to the

HECM mortgage.

☼ What if a joint owner is not age 62 or older?

That owner must transfer ownership to a qualified owner, or wait until they are at least 62 years old. LIFE ESTATES are permissible—so when children are on the deed in this situation, a HECM Mortgage can be done.

☼ What types of homes qualify for a HECM mortgage?

All 1-4 family houses and FHA-approved condos are eligible. Some programs allow for manufactured homes and co-ops to be considered. Mobile homes and homes in excess of four units are not eligible at this time.

☼ Is there any way I can keep my house in the family when I move or die? Yes. You or your heirs always have the option of paying back the loan at any point.

☼ Will I still own my home after I take out a HECM mortgage?

Yes, always. The deed stays in your name. No one else is ever added or removed from the

title without your consent.

☼ What are my obligations after taking out a HECM mortgage?

You must continue to pay your property taxes and your homeowner’s insurance, and keep the house in general good repair.

☼ Can I still move or sell my house after I take out a HECM mortgage?

Yes. You are never limited or restricted in what you can do with your house. You are free at

any time to sell; you would just pay back what you owe at the time of sale.

☼ What can cause foreclosure when there is a HECM mortgage on the property?

In general—a HECM can not cause a foreclosure. Failure to do something else is really the cause. Possible reasons may be; failure to pay property taxes and homeowners insurance, failure to maintain the property, eminent domain, abandonment.

☼ Who pays the costs of obtaining this type of a mortgage?

The costs of obtaining a HECM loan are typically rolled into the loan amount; you are paying

the costs with your equity.

☼ I am in default or in foreclosure on my current mortgage. Can I use a new HECM mortgage to pay it off?

Possibly. This is a great resource to cure that situation, however we do want to make sure that you will be in a good position financially after you get the HECM mortgage and be able to remain in the house financially secure.

☼ I am currently in bankruptcy now. Can I use a HECM mortgage to get out of this? Yes. Chapter 7 needs to be dismissed entirely. With Chapter 13 you can either pay it off or

continue your payments with the Trustee’s approval.

☼ Is the money I receive from my HECM loan taxable?

No. Loan proceeds are not considered income. Therefore, they do not affect any exemptions for property taxes, or any other needs-based programs. However, if you are receiving benefits from Medicaid we advise you to consult your Medicaid advisor for further details.

A Home Equity Conversion Mortgage is a SAFE, Government-insured loan. When combined with the right questions and answers along with great information, your concerns are eliminated and this will help you make a sound financial decision that is good for you. We can help you achieve that goal! Our Bank is a 107 year old institution with a great reputation.



Contact our team of Reverse Mortgage Specialists and let us provide a complimentary consultation. We will explain in detail exactly how the loan works, see what options may be available to you, and answer any questions that you or your loved ones might have.

FirstBank Mortgage Hotline: (877) 865-6706.


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FirstBank is a long standing member of and holds A+ rating from the BBB. We are subscribing members of the National Reverse Mortgage Lenders Association (NRMLA), and we are an approved direct lender with the US Department of Housing and Urban Development (HUD).

3500 Blue Lake Drive, Ste. 325 

Birmingham, AL 35243 
205-503-4188 | 800-200-6462