Mortgage Video & Blogging Community

HECM Counseling Requirements

The U.S. Department of Housing and Urban Development (HUD) published Mortgagee Letter 2009-10 to clarify issues regarding HECM counseling for prospective borrowers and to reiterate the requirements of Mortgagee Letter 2004-25 previously published on June 23, 2004. HUD stressed that prospective borrowers must initiate the request for counseling. “The lender may not steer, direct, recommend, or otherwise encourage a client to seek the services of any one particular counseling agency”. Additionally, Lenders may not: are required to provide every client with a list of no fewer than ten (10) HUD-approved counseling agencies that can provide HECM counseling. Five of the counselors must be in the borrower’s local area and/or state; with at least one agency within a reasonable driving distance for the purpose of face-to-face counseling.

1. Contact a counselor or counseling agency to refer a client
2. Dial a counseling agency’s phone number and then hand the phone to the borrower
3. Enter the borrower’s contact information into a web-based system which will automatically put that borrower’s name in a queue to be called by a counselor

Lenders are required to provide every client with a list of no fewer than ten (10) HUD-approved counseling agencies that can provide HECM counseling. Five of the counselors must be in the borrower’s local area and/or state; with at least one agency within a reasonable driving distance for the purpose of face-to-face counseling.

HUD has also published a final rule which establishes testing standards to qualify HECM counselors in order to provide reverse mortgage counseling to prospective borrowers. The rule establishes a new HECM Counseling Roster of eligible counselors. To view the list of HECM Housing Counselors click here.

If you would like to apply for a Delaware Reverse Mortgage or just have questions you can call John R. Thomas at 302-703-0727 or send an e-mail to DelawareMortgages@yahoo.com.

You can APPLY ONLINE NOW

John R. Thomas – Certified Mortgage Planner – Primary Residential Mortgage, Inc.

302-703-0727 DE Office / 610-906-3109 PA Office / 410-412-3319 MD Office

www.PRMIDelaware.com