Simply put you must continue to
- maintain the property,
- insure the property,
- pay taxes on the property,
- occupy the property.
Unless borrowers choose to pay and provide evidence of paying property taxes and insurance, lenders are authorized to make these payments from HECM proceeds.
Lenders are also authorized to use the loan to pay for property repairs if they are needed to maintain HUD property standards
The borrowers must continue to occupy the property as primary residence (where at least one
borrower spends the majority of the time). Borrower may reside elsewhere for a maximum of 12 consecutive months, due to physical or mental illness.
At this point, if a determination is made that it is unlikely that the borrower would return, the home would no longer be considered owner-occupied and the loan could become due and payable.
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