Practice Test Geeks(CRMP) Certified Reverse Mortgage Professional Practice Test
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HECM Program and Products Flashcards

7 cards from real CRMP practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

Read the first 7 HECM Program and Products flashcards as text

  1. Under the HECM program, what is the maximum loan-to-value ratio typically available to a 62-year-old borrower compared to an 80-year-old borrower?

    Answer: The 80-year-old receives a higher PLF than the 62-year-old

    Older borrowers receive higher Principal Limit Factors (PLFs) because they have a shorter expected loan term, reducing lender risk.

  2. Which HECM product feature allows borrowers to receive a fixed monthly payment for as long as they occupy the home as their principal residence?

    Answer: Tenure payment plan

    The tenure payment plan provides equal monthly payments for the life of the loan, continuing as long as the borrower lives in the home.

  3. What happens to the unused portion of a HECM line of credit over time?

    Answer: It grows at the same rate as the loan's interest rate plus MIP

    The unused HECM line of credit grows at the current note rate plus the ongoing MIP rate, increasing the borrower's available funds over time.

  4. A HECM borrower passes away and leaves the home to an adult child who does not wish to sell. What is the maximum amount the heir must pay to keep the home?

    Answer: 95% of the current appraised value

    Non-borrowing heirs may satisfy a HECM by paying 95% of the current appraised value, even if the loan balance exceeds the home's worth.

  5. Which scenario would trigger an immediate due-and-payable event on a HECM loan?

    Answer: The last surviving borrower moves to an assisted living facility for 12 consecutive months

    A HECM becomes due and payable when the last surviving borrower has not occupied the home as a principal residence for 12 consecutive months.

  6. Under the HECM for Purchase program, what is the primary source of funds the borrower must bring to closing?

    Answer: Personal funds from savings, retirement accounts, or sale of existing home

    HECM for Purchase requires borrowers to contribute personal funds (down payment) from eligible sources such as savings, retirement accounts, or proceeds from the sale of a prior home.

  7. What is the role of the Expected Average Mortgage Interest Rate (EAMIR) in HECM calculations?

    Answer: It is used to calculate the Principal Limit Factor from HUD tables

    The EAMIR (also called the Expected Rate) is used with the borrower's age to look up the applicable Principal Limit Factor from HUD's PLF tables.