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HUD counselors supply new steering on reverse mortgage packages


The U.S. Division of Housing and City Improvement (HUD) Workplace of Housing Counseling (OHC) has made a sequence of updates to its Housing Counseling Program Handbook, together with intensive additions, consolidations and reorganizations to a bit targeted on the Dwelling Fairness Conversion Mortgage (HECM) program.

That is based on a January assembly of the Housing Counseling Federal Advisory Committee (HCFAC), the place the modifications had been detailed by OHC Workplace of Coverage and Grant Administration specialist Terri Ames.

David Berenbaum, HUD’s deputy assistant secretary for housing counseling, additionally expressed an ongoing need to work with the reverse mortgage business and educate the general public in regards to the HECM program.

Consolidation efforts

Most of the handbook updates associated to the HECM program revolved round consolidating and streamlining steering to make it much less complicated for counselors in search of to seek out the fitting data, Ames defined.

“[We sought to] to minimize confusion and separate reverse mortgage counseling and the HECM protocol,” she stated.

The HECM protocol is now present in appendix one of many handbook. It “supplies all necessities for conducting the HECM counseling session and all of the handouts and sources that counselors might want to have a profitable session,” she stated.

Amongst key HECM-related updates, Ames famous that there’s extra inclusion and extra references to different HUD steering — together with the Single Household Housing Handbook, which obtained intensive, years-in-the-making reverse mortgage updates final 12 months. This helps the counseling handbook keep away from each inconsistent and duplicative data.

A number of subsections had been consolidated into separate sections associated to extra normal reverse mortgage counseling and HECM-specific counseling, whereas different sections had been reorganized to clarify that overarching counseling steering can be relevant to reverse mortgage counseling.

Product data and extra

The handbook provides details about the variations between subsets of reverse mortgages, together with between conventional HECMs and proprietary merchandise supplied by lenders impartial of the Federal Housing Administration (FHA)-backed program.

Clarifying language was additionally added to make sure that readers perceive that reverse mortgage counseling “have to be supplied by a HUD-certified counselor,” Ames defined.

The revisions additionally contained particular steering for counselors associated to the HECM for Buy (H4P) program, in addition to qualifying “thriller buying” — through which “skilled personnel act as potential shoppers” — as a “potential company high quality management technique.”

Particularly within the HECM part of the handbook, the revisions broadened modalities to incorporate digital or distant counseling strategies, along with phone-based counseling, in an effort to replicate extra trendy communication know-how.

There’s additionally extra particular contact data for “issues or complaints” relating to reverse mortgage lenders or counselors, which now consists of the FHA and the OHC itself. And there’s added data relating to the issuance of a HECM counseling certificates.

Want for training

In a closing “member feedback” part of the January assembly, Berenbaum defined that there’s a must carry out public outreach about sure HUD packages, and he cited reverse mortgages for instance.

“Wanting additional forward, we do foresee reaching out to the general public in different areas,” Berenbaum stated. “On the Nationwide Reverse Mortgage Lenders Affiliation (NRMLA), I expressed curiosity in collaborating with that commerce affiliation and its members to teach most people [about] the reverse mortgage product.”

Berenbaum additionally briefly spoke in regards to the reputational challenges of the reverse mortgage business, and the way a few of them are rooted in both dangerous or misunderstood details about the product class.

“There’s lots of misinformation on the market about reverse mortgages, and as extra child boomers age in place with out satisfactory sources in retirement, I believe it’s a essential product shifting ahead for these child boomers to have details about,” he stated. “[That way], they will make extra knowledgeable selections about [reverse mortgages] by the housing counseling group.”

These statements echo a lot of what Berenbaum stated on the NRMLA Annual Assembly and Expo in Nashville final October, each in ready remarks delivered to business professionals and in an interview with RMD performed on-site on the occasion.

The expectation in his workplace is that because the American inhabitants ages, reverse mortgage volumes will rise. This may require further collaboration between his workplace and members of the reverse mortgage business, Berenbaum stated on the occasion.

“First, we wish to improve our collaboration with NRMLA and all of you as business professionals,” he stated throughout his presentation. “It is a precedence for us. As People are growing old, we all know that, the truth is, there shall be a rise within the variety of reverse mortgages originated, and we’ll see a rise within the reverse mortgage for buy aspect of the equation as nicely. There’s a essential function of housing counseling there.”

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