What is Reverse Mortgage Counseling and why is it required?
To qualify for a Reverse Mortgage, all borrower(s) must go through third-party counseling. Counseling ensures that you are aware of all of your financial options before you continue the Reverse Mortgage process.
Reverse mortgage counseling is facilitated by a neutral third-party who is approved by the United States Department of Housing and Urban Development (HUD). You don’t have to worry about finding a counselor on your own. Your proposal includes a list of HUD-approved counselors in your area and explains in more detail what they will ask, and why.
Why is counseling done by a third party?
Third-Party Counseling is required by law to make certain that the information we give you is unbiased. The counselor makes sure you understand the Reverse Mortgage program and other possible financial options. They want to make sure you are truly making the best decision for yourself. After your counseling session, you will feel confident in the program you’ve selected.
What to expect during the counseling process
The counseling appointment can be facilitated over the phone or in person and it typically takes about an hour or so. All you have to do is choose a counselor from the list and make an appointment. We ensure that you are well informed about the Reverse Mortgage process, and can help prepare you for your counseling session. Your counselor will confirm that you understand the details about a Reverse Mortgage and have an in-depth discussion with you about your financial situation and options.
Your counselor is required to review your housing and financial options, inform you of the possible effects of a Reverse Mortgage on any state and federal programs, and the impact that a Reverse Mortgage could have on your heirs. The job of a counselor is to not direct you toward a specific solution, specific product, or a specific lender. Having a third-party helps to ensure that you are educated about your choices.
A mortgage is one of the largest commitments you will ever make, and the same is true for a Reverse Mortgage. After counseling, if you feel that a Reverse mortgage fits your lifestyle and goals, we can proceed with an Application to the Lender.