Reverse Mortgage Changing – Part 1

As a leading independent news source for the senior community, RMinfo.com wants to help consumers understand changes to reverse mortgages including those coming September 11th, October 1st, and January 1, 2011.  The focus in this article is on changes taking place September 11, 2010 to counseling for the federal government insured reverse mortgage, called the Home Equity Conversion Mortgage (“HECM”).

Counseling is a consumer protection Congress and the Department of Housing and Urban Development (“HUD”) built into the HECM program to 1) provide information, 2) answer questions, and 3) help consumers understand how a HECM will impact them.  Counseling is provided through counselors employed by qualified non-profit financial agencies, unrelated to any lender.  All HECM borrowers must take counseling.  Counselors are trained on HECMs and must pass a thorough exam on them.

HECM counseling now includes the Financial Interview Tool (“FIT”) created by the National Counseling on Aging (“NCOA”).  Counselors will use FIT responses to provide 1) an overview on how a HECM will help not only now but also in the future and 2) information on other government programs.

Many participants will be required to engage in a more thorough analysis of their overall situation through the Benefits Check Up (“BCU”) program also created by the NCOA. While there are no wrong responses to either FIT or BCU questions, they are an integral part of counseling and must be answered to receive the counseling certificate.  Once a signed certificate is received and a loan application completed, the HECM loan process can move forward.

Participants find counseling far more rewarding when they are prepared.  An experienced Mortgage Loan Originator can help you throughout the entire HECM process including counseling preparation.  To get experience you can count on, click on the “Have a Question?” link at the top of the screen and request the contact info for one of our approved and pre-screened loan originators today.

Check back soon for Reverse Mortgage Changing – Part 2