HECM (Reverse Mortgages) - New Counseling Disclosure Requirements


Counseling is a central feature of the Home Equity Conversion Mortgage (HECM) program. Without a counseling certificate from an FHA-approved provider, a lender may not originate a HECM. Counseling has always been part of the HECM program, going back to Handbook 4235.1 Rev-1, which outlines the basic program. Published in 1994, it has been continuously revised through Mortgagee Letters, HECM regulations, and, of course, amendments to the HECM statute. Handbook 7610.1 contains the HECM Counseling Protocol.

Recently, HUD issued Mortgagee Letter 2010-37, which seeks to clarify certain aspects of the required List of HECM Counseling Agencies (Counselors List), along with guidance about completing the FHA Connection case assignment screens for HECMs vis-à-vis the Counselors List, and the timing for completion of certain relevant screens.

The salient requirement: lenders are required to provide each client with a list of HECM counseling agencies and that list must include no fewer than nine HUD-approved counseling agencies, based on specific criteria.

The article provides the effective compliance date and lender disclosure requirements.

LOADING PDF: If there are any problems, click here to download the file.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Jonathan Foxx, Lenders Compliance Group | Attorney Advertising

Written by:


Lenders Compliance Group on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:

Sign up to create your digest using LinkedIn*

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.

Already signed up? Log in here

*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.