A HECM can eliminate a required monthly principal-and-interest mortgage payment, but it does not eliminate the obligations of owning a home. This HECM borrower responsibilities checklist explains the commitments that help you keep your Alabama home, avoid a loan default, and make informed decisions with confidence.

A Home Equity Conversion Mortgage, or HECM, is a federally insured reverse mortgage available to eligible homeowners age 62 and older. You generally retain title to the property. The loan becomes due only after a maturity event, such as the last borrower leaving the home permanently, selling it, or passing away. Until then, meeting the responsibilities below is essential.

HECM Borrower Responsibilities Checklist

Live in the home as your primary residence

A HECM is intended for your principal residence, not a vacation property, rental home, or second house. You must occupy the property as your primary home for most of the year.

Temporary absences are allowed. A stay with family, travel, or rehabilitation may not create a problem if the home remains your principal residence. However, if the last surviving borrower or eligible non-borrowing spouse is away for more than 12 consecutive months because of physical or mental illness, the loan may become due and payable. A shorter absence for a non-medical reason can also matter, particularly if it extends beyond six months.

Keep the loan servicer informed if you expect to be away for an extended period. Do not assume a relative’s presence in the home satisfies the occupancy rule. The requirement applies to the borrower or, where applicable, an eligible non-borrowing spouse.

Pay property taxes on time

Property taxes remain the homeowner’s responsibility. In Alabama, tax bills may be modest compared with some states, but they still must be paid in full and on time. A missed payment can place the reverse mortgage in default, even when no monthly mortgage payment is required.

Your servicer may send reminders or request proof that taxes were paid. Save tax receipts, confirmation numbers, and correspondence in one place. If your tax bill changes, do not wait until the due date to determine how it fits into your monthly budget.

Some borrowers have a Life Expectancy Set-Aside, often called LESA, established at closing. This is a portion of loan proceeds reserved to pay property taxes and homeowners insurance. If you have a fully funded set-aside, the servicer generally handles those payments. You should still review your annual statements and verify that the payments are being made correctly.

Keep homeowners insurance in force

You must maintain hazard insurance on the property for the life of the loan. The policy must meet the servicer’s coverage requirements and be kept current without a lapse. If you change insurers, adjust coverage, or receive a renewal notice, provide the updated information when requested.

For homeowners along the Gulf Coast or in areas with heightened storm exposure, wind and flood coverage can require special attention. Standard homeowners insurance may not cover flood damage. Whether flood insurance is required depends on the property’s flood-zone status and other loan requirements. Your servicer can clarify the coverage it needs, while an insurance professional can explain the protection your policy provides.

Insurance premiums can rise over time. Build that possibility into your retirement budget, especially if your home is in a location where storm-related coverage is costly.

Maintain the property in reasonable condition

A HECM borrower must keep the home in good repair. This does not mean every update must be cosmetic or expensive. It means protecting the home from deterioration that could affect its safety, livability, or value.

Address roof leaks, plumbing failures, electrical hazards, structural problems, and major water damage promptly. Keep the exterior secure and prevent small maintenance issues from becoming serious repairs. Routine care such as clearing gutters, servicing heating and cooling equipment, trimming overgrowth, and repairing loose steps can protect both your home and your ability to remain there comfortably.

The practical question is not whether a home looks newly renovated. It is whether it remains safe, sound, and adequately maintained. If a significant repair is beyond your budget, contact your servicer before the problem worsens. Early communication may give you more options than waiting for a property inspection to identify a serious concern.

Pay any required property charges

Beyond taxes and insurance, property charges may include homeowners association dues, condominium fees, ground rent, special assessments, and similar obligations. Not every Alabama homeowner has these costs, but they can be substantial in certain neighborhoods, condominiums, and planned communities.

Read every annual notice from your association or local taxing authority. An unpaid HOA assessment can create a lien against the property and may lead to a default under the reverse mortgage. If your payment amount rises, revisit your household budget quickly rather than relying on a future loan advance to solve the problem.

Complete annual occupancy certification

Most HECM borrowers receive an annual occupancy certification form from their servicer. This form confirms that the home remains your principal residence. Return it promptly and accurately.

This step may feel routine, but ignoring it can lead the servicer to believe the home is no longer occupied. If you did not receive a form, moved temporarily, or have questions about what to report, call the servicer using the number on your statement. Keep a copy of what you submit.

Open and respond to servicer mail

A reverse mortgage requires ongoing attention, even though it does not require a monthly mortgage payment. Statements, insurance notices, tax inquiries, occupancy forms, and default notices should never sit unopened.

Choose one dependable place for loan paperwork. If a trusted adult child or other family member helps with household finances, consider giving that person permission to receive information from the servicer. This does not make them responsible for the loan, but it can prevent a missed notice from turning into a larger problem.

Understand when the loan may become due

The HECM balance grows over time because interest, mortgage insurance premiums, and financed closing costs may accrue on amounts borrowed. The loan is generally due when the last borrower and any eligible non-borrowing spouse no longer live in the home as a principal residence, sells the home, passes away, or fails to meet the property obligations.

A due-and-payable notice is serious, but it does not always mean the home must immediately be lost. The available options depend on the reason for the notice, the timing, the property’s value, and the people involved. In many cases, a sale, refinance, repayment, or extension may be possible. Contact the servicer promptly and seek qualified guidance before deadlines pass.

What Your Heirs Should Know

Many families worry that heirs will inherit a reverse mortgage debt larger than the home’s value. With a HECM, heirs are generally not personally liable for more than the home’s value at the time the loan is repaid, provided the loan requirements have been met. The home can be sold, and any remaining equity after repayment belongs to the estate or heirs.

Heirs who want to keep the home may have the option to repay the balance or pay 95% of the home’s current appraised value, whichever amount is less, subject to program rules and deadlines. They should notify the servicer early, obtain clear information about required documentation, and avoid making decisions based on assumptions about the balance or property value.

A direct family conversation while you are healthy can make this process much easier. Explain where you keep your HECM documents, tax and insurance records, estate papers, and servicer contact information. That conversation preserves choice when your family may need it most.

A Simple Way to Stay Current

Review your reverse mortgage obligations at least twice each year: once when property-tax information arrives and again when your homeowners insurance renews. Confirm that the home is insured, taxes and any association fees are paid or scheduled, and necessary repairs are being addressed. Then review your latest loan statement and file any notices that need a response.

A HECM is designed to support aging in place, but it works best when homeownership responsibilities are treated as part of the retirement plan. A few organized records, a realistic budget for property costs, and a timely call when circumstances change can help protect the home and the independence it represents.