The Department for Housing and Urban Development (the HUD) and the Federal Housing Administration (the FHA) which are the Federal departments in charge of regulating and guaranteeing Home Equity Conversion Mortgages (or HECM) and the Reverse Mortgage Industry. They have just introduced some new rules and regulations for Reverse Mortgage Counselors.
These counselors are HUD and FHA approved agencies and offices that any Mortgage applicant must meet with before an application can be received and processed. This mandatory step for Reverse Mortgage applicants was initiated in order to protect seniors from predatory lenders, and individuals looking to perpetrate frauds on unsuspecting borrowers.
The New Rules the HUD has enacted require every counselor to pass an exam. This exam was created by the certain senior agencies and every counselor must pass this exam and then participate in further continuing education every two years. Lastly, the counselor must also follow a set of guidelines designed to discover whether a the Reverse Product is suitable, and will be advantageous to the borrower. In other words, the counselor will be making sure that the borrower is not being taken advantage of.
After doing some discreet testing of counselors with under-cover "borrowers" going into counseling sessions, the FHA and the HUD realized that there needed to be some drastic changes to the system. They need counselors to cover all the topics required to make sure seniors are informed of their options. They also need to be more attuned to the borrower's financial situation and the goals of each applicant.
Counseling will be available for each borrower, in every state, over the phone. This will enable seniors who may not have an approved agency in their area to have their meeting as quickly as possible. For a list of approved Reverse Mortgage Counselors in your area and to have a free, no Home Equity Conversion Mortgage estimate emailed, faxed, or mailed to you please contact Troy Shellhammer at 1-888-973-8377.
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Troy Shellhammer is an expert and writer in the Industry. Call him at 1-888-973-8377 with any questions.
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