What To Expect From HECM Counseling
- Education: Explanations of reverse mortgage features. Discussions of the appropriateness of a reverse mortgage based on your individual situation, and other financial options that might meet your needs.
- Guidance and resources designed to enable you to make an informed decision
- Ongoing support throughout the HECM process.
- Your individual needs and circumstances
- Features of a reverse mortgage
- Your responsibilities under a reverse mortgage
- Costs to obtain a reverse mortgage
- Financial/tax implications of a reverse mortgage
- Financial or social service alternatives to a reverse mortgage
- Warnings about potential reverse mortgage/insurance fraud schemes and elder abuse
- Depending on your financial circumstances, there may be fees for your counseling session. Our short, three-minute video explains more.
- HUD encourages face-to-face counseling, and certain states require in-person counseling for all borrowers considering reverse mortgages. For clients that can’t meet in-person, it may be possible to engage in telephone counseling.
- You can search for a government-approved third party counselor near you on HUD’s website here.
Things to know about Reverse Mortgages:
- At the conclusion of a reverse mortgage, the borrower must repay the loan and may have to sell the home or repay the loan from other proceeds
- Charges will be assessed with the loan, including an origination fee, closing costs, mortgage insurance premiums and servicing fees
- The loan balance grows over time and interest is charged on the outstanding balance
- The borrower remains responsible for property taxes, hazard insurance and home maintenance, and failure to pay these amounts may result in the loss of the home
- Interest on a reverse mortgage is not tax-deductible until the borrower makes partial or full re-payment