The Mortgagee (lender) must verify and document the HECM borrower’s receipt of periodic payments from the HECM borrower’s pension and that the payments are likely to continue for at least three years.
The Mortgagee must obtain any one of the following documents:
- federal tax returns;
- the most recent bank statement evidencing receipt of income from the former employer; or
- a copy of the HECM borrower’s pension/retirement letter from the former employer.
The Mortgagee must use the current amount of pension income received to calculate effective income.
For additional information see Mortgagee Letter 2016-10 and the attached revised HECM Financial Assessment and Property Charge Guide, Sections 3.46 and 3.47 at https://www.hud.gov/program_offices/administration/hudclips/letters/mortgagee