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Mortgage Glossary

Home Equity Conversion Mortgage (HECM)

Mike Starr·Reviewed August 2026

A Home Equity Conversion Mortgage is the most common type of reverse mortgage, insured by the Federal Housing Administration. It allows homeowners aged 62 or older to convert a portion of their home equity into cash without monthly mortgage payments. The loan balance grows over time and is repaid when the borrower sells, moves out, or passes away.