Are there additional test case requirements to be granted Unconditional DE authority for HECM loans?

The mortgagee must obtain separate Direct Endorsement (DE) approval for forward mortgage and Home Equity Conversion Mortgage (HECM) programs. 

The mortgagee must receive a minimum of 5 Firm Commitments for HECM authority within a period of 12 consecutive months following the date of the entrance conference in order to be granted Unconditional DE authority.  After the mortgagee successfully completes the required Test Cases, FHA will grant the mortgagee approval for Unconditional DE authority. 

Handbook 4000.1 1.A.5.a. is available at

All policy information contained in this knowledge base article is based upon the referenced HUD policy document. Any lending or insuring decisions should adhere to the specific information contained in that underlying policy document.

Topic Number: KA-05057