What is the HECM 100?
HECM stands for Home Equity Conversion Mortgage. HECMs are federally insured reverse mortgages and are the most popular type of reverse mortgage.
100 stand for the interest rate margin on the HECM loan. Traditiaonally, the margin has been 150 basis point (1.5%). This margin is added to the 1-year US treasury rate to detrmine the interest charged on a reverse mortgage. In 2007, various lenders came out with HECM loans that carried a 100bp (1.00%) margin and these are known as HECM 100 reverse mortgages.
The HECM 100 is a new product based on the Treasury Rate plus a margin of 100 basis points. The lower margin increases the Principal Limit or loan amount.