HECM loans may be insured and remain in force if the property is held in a life estate. If an eligible mortgagor holds only a life estate when the mortgage is executed, all holders of any future interest in the property (remainder or reversion) will also be required to execute the mortgage to ensure that the mortgage is secured by a fee simple interest. A holder of a future interest does not execute the note or loan agreement and does not have the rights to loan proceeds of other mortgagors. A mortgagor who held a fee simple title when the mortgage was executed may subsequently convey his or her interest in the property, as long as a life estate is retained.
For additional information see Mortgagee Letter 1997-15 available at https://www.hud.gov/program_offices/administration/hudclips/letters/mortgagee