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Once a principal residence has been purchased using HECM loan proceeds, can the property serve as collateral for another secured loan?

April 26, 2017collateral hecm loan Principal proceeds Property Residence secured loan serve

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Once a principal residence has been purchased using HECM loan proceeds, can the property serve as collateral for another secured loan?

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Yes, only after the mortgage insurance certificate has been issued. Lenders are responsible for ensuring additional secured liens are subordinate to the HECM first and second liens. Such financing may not occur concurrently with the HECM closing.